Posted on March 23, 2020
Knox Law is committed to serving clients during the COVID-19 Pandemic. Our offices are now open by appointment only, subject to applicable guidance. Many professionals and staff continue to work remotely and are all available by phone and email to help with your questions and concerns.
We remain focused on client care and responsiveness - please reach out to us as needed:
The Small Business Administration (SBA) issued a notice on Friday October 2, 2020 explaining required procedures when an entity that has received a Paycheck Protection Program loan experiences a change in ownership.
PPP loan borrowers must notify their PPP lenders in writing prior to the closing of any covered change in ownership, which occurs when at least 20% of common stock or other ownership interest in a PPP borrower is sold or transferred, when the borrower sells or transfers at least 50% of its assets, or when the borrower merges with or into another entity.
SBA approval may or may not be required in certain situations as outlined in the Procedural Notice.
The notice can be found in its entirety here: SBA Procedural Notice 5000-20057
On July 20, 2020, the U.S. Department of Labor published additional guidance for workers and employers on how the protections and requirements of the Fair Labor Standards Act (FLSA), the Family and Medical Leave Act (FMLA), and the Families First Coronavirus Response Act (FFCRA) affect the workplace as workplaces reopen amid the coronavirus pandemic. The guidance from the Department’s Wage and Hour Division (WHD) includes commonly asked questions and answers that address critical issues in all three laws - see more here.
Pennsylvania Employees Returning from Travel May Qualify for FFCRA Leave During Quarantine Period - learn more here.
The U.S. Department of Labor (DOL) issued a Field Assistance Bulletin (FAB No. 2020-4) on June 26, 2020 regarding FFCRA Leave based on the closure of summer camps, enrichment programs and other summer programs. Read more here.
Reminder: the Commonwealth of Pennsylvania is requiring businesses with in-person operations or who are open to the public to post a COVID-19 Safety Procedures for Businesses flyer on their premises. More here.
The DOL, HHS and Treasury have compiled FAQs regarding implementation of the Families First Coronavirus Response Act (FFCRA), the Coronavirus Aid, Relief, and Economic Security (CARES) Act, and other health coverage issues related to COVID-19. More here.
The Paycheck Protection Flexibility Act of 2020 has been signed into law on June 5, 2020.
The PPP Flexibility Act provides PPP loan borrowers with 24 weeks to utilize PPP loan funds, instead of 8 weeks. It also allows borrowers to utilize no more than 40% on non-payroll cost expenses, versus the current 25% threshold.
Also, it provides the borrower the opportunity to negotiate with the PPP lender/bank to extend the term of the loan to a minimum of 5 years, instead of the current 2 year period. Borrowers have until December 31, 2020 to "fix" any reduced number of employees or salary reductions that may impact forgiveness. The previous deadline was June 30, 2020.
Additionally, the payments of the loan are now deferred until the amount of loan forgiveness is determined. Previously it had been for 6 months from receipt of the loan.
Information on employees refusing to return to work, and recommendation to check unemployment compensation charges very carefully: UC & Work Refusal in Pennsylvania
The IRS has released Notice 2020-39, extending critical Opportunity Zone deadlines.
Now, an investor whose 180 day period to invest in a Qualified Opportunity Fund (QOF) expired on or after April 1, 2020, but before December 31, 2020, can make that investment up to December 31, 2020.
This extension allows taxpayers who realized gains at any period from the fourth quarter of 2019 until April 1, 2020 to invest those funds into a QOF before the end of 2020. This extension will give taxpayers the maximum ability to realize significant tax advantages through the investment of capital gains in Opportunity Zones.
Additionally, the Notice provides that the period of April 1, 2020 through December 31, 2020 is not counted for purpose of the 30 month substantial improvement period. This allows Opportunity Zone projects that were stalled as a result of the mitigation efforts of COVID-19 to be continued as qualified OZ projects.
"The U.S. Department of Labor’s Occupational Safety and Health Administration (OSHA) has issued an alert listing steps employers can follow to implement social distancing in the workplace and to help protect workers from exposure to the coronavirus."
The SBA Issued its Interim Final Rule on Loan Forgiveness as well as its Interim Final Rule on SBA Loan Review Procedures and Related Borrower and Lender Responsibilities on May 22, 2020.
Each can be found at the following links:
The SBA has posted a Borrower's Loan Forgiveness Application. We will circulate more information upon review; however, you can begin to review it here: SBA Borrower's Loan Forgiveness Application
More information and analysis of SBA's FAQ #46 and #47, issued May 13, 2020 (here).
The full IRS notice can be accessed here: https://www.irs.gov/pub/irs-drop/n-20-32.pdf
Section 2202 of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), enacted on March 27, 2020, provides for special distribution options and rollover rules for retirement plans and IRAs and expands permissible loans from certain retirement plans.
In addition to the complicated rules and requirements to achieve maximum loan forgiveness, there are a number of open issues the SBA and Treasury must address in order to get a better (and more complete) picture on how a PPP loan borrower can get the best use and results from the PPP loan funds. Read more here.
It is not too early to start thinking about the ways to maximum your PPP loan forgiveness... because, let’s face it, that is one of the most attractive features of these PPP loans. Read more here.
As of April 10, 2020:
The Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) permits greater access to retirement plan distributions and loans, and a one-year waiver of the Internal Revenue Code’s (“Code”) required minimum distribution rules. Employer sponsors of retirement plans may amend their plans to adopt the relief measures afforded by the CARES Act. Read more here.
We have seen a flurry of activity from all sectors of government in recent days to assist businesses who are dealing with this unprecedented time in our economy and public health arena. Click here for a summary of loan opportunities, tax credits, and contract considerations.
Our estate attorneys and staff are pleased to review, at no cost, estate plans we prepared for you (or your clients). Further, if you are a new client concerned about your estate plan and would like to have us review it, there is also no charge for our review.
NOTE: under Pennsylvania law, wills and trusts do NOT need to be witnessed or notarized to be valid. We can provide documentation to clients who wish to revise or develop their estate plans. The clients can execute the documents in their homes and, after the pandemic subsides, we can more fully review the plans and, if necessary, adjust them further at our office and provide for witnesses and notarization. Please read our full statement here.
Contact our Estate Planning Attorneys today.
For more information, please contact Sarah Holland.