There is one inescapable fact in the middle of this mess. It is the fact that in order to take advantage of The Payroll Protection Program Loan or The Employee Retention Credit, you need to have some money to work with in the first place.
What if you are completely shut down and you have absolutely nothing coming in? How can you pay any payroll so that you can take advantage of a credit? What if you are partially shut down, like a restaurant that used to do $100,000 per month. Now they are lucky to $15,000 with delivery and take out orders. That money barely pays for a line cook, someone to take phone orders, and some inventory.
How are you going to take advantage of any of these lofty federal programs in the first place without money? The answer is that you cannot. Cash is the life’s blood of any organization. Without it, the body dies. You need to do whatever is necessary to keep your enterprise going.
If that means that all or a portion of your staff needs to be laid off, then that’s what it means. Entrepreneuring isn’t an easy job at times.
No one asked for any of this. No one wanted it. But if that is what you need to do to survive, then get it done.
Illinois Unemployment
I realize that over 500 of my daily readers are from outside of Illinois, so I need to preface this by saying that I am only talking about the Unemployment Rules and Laws of the Land of Lincoln. If you are not from Illinois, please go to your local Unemployment Board for the individual rules of your particular state.
How is the weekly unemployment benefit determined?
In Illinois, your weekly benefit is determined by adding together your earnings in the two quarters of the base period when you earned the most, then taking 47% of that total, and then dividing the result by 26.
Example 1) A worker makes $20,000 per year. The highest two quarters are then a total of $10,000 in wages multiplied by 47%. That $4,700 is then divided by 26. This means that this worker’s weekly benefit will be roughly $180.
What is the maximum weekly benefit?
$471 per week.
Can I get additional benefits if my spouse does not work, or I have Children?
Yes, you can. There are additional benefits for both a spouse or children, but you can only claim one.
Are there additional Unemployment Benefits under The CARES Act?
– The Cares Act provides an additional $600 in weekly benefits for unemployment recipients.
– The additional benefit is only applied to benefits between April 5, 2020 and July 31, 2020
– The act also increases the number of weeks where a person can qualify for benefits.
– The normal period of unemployment benefits is 26 weeks. That is increased by 13 weeks to 39.
– If a worker has already exhausted their unemployment benefits, they can now receive 13 additional weeks of payments.
Have the additional $600 in federal payments for benefits begun yet?
No, they have not. But according to some sources, they might begin as early as next week.
What if you were laid off because your business was temporarily shut down due to the virus?
You can qualify for benefits as long as you are able and available for and actively seeking work.
What if you quit your job because you are generally concerned about the virus?
An individual who does this is generally disqualified from receiving benefits.
What if you leave work because your child’s school is temporarily closed and you need to care for your child?
You are generally qualified for benefits.
If an employee receives benefits as a result of the virus, will your unemployment contribution rate increase?
The Department isn’t saying anything one way or another. But I’ll bet you dimes to donuts that they will.
Can I claim unemployment benefits on my own company?
This is tricky. You’re not supposed to claim it on your own company. As long as your business is open, technically you are not unemployed. But I do not know of a situation where benefits have been denied.
If you have ever had a claim for benefits from an employee that you have fought, you know how unreasonable Illinois is in denying them. We operate businesses in a state that is unabashedly pro-worker rather than pro-employer. Their knee jerk response is always to provide rather than deny.
How to file a claim for Unemployment Benefits.
You can file a claim online if you go to
https://www2.illinois.gov/ides/Pages/default.aspx
You can also file a claim if you go to your local office.
Additional information on Unemployment Benefits during the Covid-19 era can be found at
https://www2.illinois.gov/ides/Pages/COVID-19-and-Unemployment-Benefits.aspx
Update of Tax Filing Deadlines
The April 15th filing deadline for Personal, Estate, Trust and C Corporation Returns
Both the Federal and State Income Tax filing deadline for the 2019 returns have been backed up to July 15, 2020. That means that you do not need to file a return, or pay any amounts due without facing a penalty, as long as they are in by the new due date.
1st Quarter 2020 Estimated Tax Deposits
Quarterly estimated tax deposits at the Federal level have also been backed up to July 15, 2020. But Illinois has changed nothing. If you have a first quarter estimate that is due by April 15th for your Illinois return, please get it in timely.
The 1040 Extension Due Date of April 15, 2020
Nothing has changed in this regard. Even though the due date of the return is now July 15, 2020, if you would like the automatic six month extension, this still needs to be filed. I am in the middle of filing the extensions right now.
One parting thought…
I just don’t want you to think that you are alone in this mess. Whatever your situation happens to be, this is affecting you in some way.
To all of my Brothers and Sisters who have filed for the PPP Loan, and are awaiting a decision, I’m with you.
To all of my Brothers and Sisters who are now claiming the Employee Retention Credit on their payroll, I’m with you.
And to all of my Brothers and Sister who have either needed to lay off staff members, or filed for benefits themselves, I’m with you.
You are not alone. We are going to get through this nightmare together.
Accounting Solutions Ltd. stands ready to fulfill its mission and purpose of protecting you, your family, and your business. If there is anything that you need, or if you just want to talk to someone, we stand ready to help in any way that we can. I’m here, I’m with you, and I remain,
Chris Amundson
President
Accounting Solutions Ltd.
773-267-7500
888-310-0300
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