Updates on The President’s Executive Order

After months of haggling on Capitol Hill, our Congress left Washington for a recess without passing anything to help in the continuing fight against the pandemic. That’s right…nothing.
 
Sadly, it is obvious that the process of governing our nation though this nightmare has become nothing more than the ugliness of partisan politics. Our citizens are hurting and dying, while Congress is simply taking a break.
 
In response, our President signed four separate documents on August 8th in an attempt to provide some sort of relief. The politicians on the other side of the aisle have since put up every road block in their arsenal to stop this help. I’m going to spend some time going over each of them in detail…
 
The $400 Unemployment Benefit
 
In this memorandum. the Federal Government would provide an additional $300 in weekly benefits while the individual states are responsible for the additional $100. This is causing substantial amounts of push back from many, primarily Democratic controlled states, saying that they cannot afford their portion.
 
This is funded through leftover and unspent funds from FEMA, The Federal Emergency Management Agency. In order for states to take advantage of this for their citizens, they must apply with the agency to receive the funding. To date, seven states have been approved. The first state to be approved was Arizona. The additional payments are going out to their residents this week.
 
A legal challenge is likely given the fact that it is the job of Congress to approve federal spending. Our President does not have the legal authority to direct how federal funds are spent during a pandemic.
 
Eviction Order Protections
 
This is a big deal. Certain estimates show that as many as $40 million Americans are at risk of losing their homes currently.
 
The current directive signed by the President leaves the authority to ban evictions in the hands of the Health and Human Services Secretary and the CDC Director. Further, it says nothing about providing any additional financial assistance, which would be up to the Director of The Treasury and HUD.
 
The CARES Act specifically banned late fees and evictions until July 25th on properties backed by Fannie Mae of HUD based mortgages.
 
Student Loan Payment Deferrals
 
This memorandum extends the deferral of student loan interest until December 31st, 2020. Payments on these loans would resume at the beginning of next year. The problem is that it does not apply to all student loans, but only to those loans held by The Department of Education.
 
The Payroll Tax Cut
 
I called it that because everyone is calling it a “cut”. It isn’t a cut, but rather a deferral. The language in the order says that the Treasury Secretary can authorize his authority to, “defer the withholding, deposit and payment of the tax.” This would be for a period from September 1, 2020 through December 31, 2020.
 
That’s all that it says. Nothing further.
 
Given the fact that it is a deferral rather than a cut, what’s the point? I’d rather pay my payroll taxes now, and make sure that they are paid. No one needs to go into payroll tax deposit hell. Will this be challenged? Probably.
 
Anything else?
 
Nope. We were directed by the SBA to not submit anything further in regards to PPP Loan Forgiveness prior to the August 8th Congressional Recess. Everyone was expecting them to forgive all loans below $150K.
 
Treasury Secretary Munchin even said that he would support it, when it was the other side’s idea in the first place. But nothing got done. As such we will again start completing the loan forgiveness paperwork. If we have requested information from you in this regard, please forward it at your convenience.
 
We have ten months after the expiration of the forgiveness period to submit the paperwork. If you are electing the 24 week period, that might give you up to October of 2021 to submit the 3508. Don’t worry. We’ve got plenty of time.
 
Let me leave you with this one thought…
 
If I had a crystal ball, I wouldn’t do tax returns and accounting for a living. But there was an enormous amount of pressure put on Congress to do something before the recess. They did absolutely nothing. When the President tried to do something, they jumped all over him.
 
As all of you know, I don’t do politics. I’m too much of a Chicagoan. I have been following this very carefully over the past couple of weeks. The childishness, the name calling, and the finger pointing didn’t end. And I don’t think that it will end before the November elections.
 
My Brothers and Sisters, what you currently have is exactly all that you might expect to get.
 
Many American businesses are teetering on insolvency. Given the fact that the stimulus money is already used fully or partially, this leaves decisions that must be made.
 
You need to put a plan in place to get through this no matter what happens in the future. It doesn’t look like much is going to happen in the future to help us.
 
You need to do whatever is necessary to get through this. If you need to cut staff, do it now. If you need to run your inventory down to unheard of before lows, then reduce your outbound orders. If you need to radically change your business plan, then let’s get radical.
 
I don’t think that we are going to get a lot from Washington or Springfield other than a lot of hot air in the near future.
 
You can do this. You can get through this. If you have questions, please call. Do so knowing that we will all get through this together.
 
Accounting Solutions Ltd. stands ready to complete our mission and purpose of protecting you, your family and your business. If there is anything that you need, whether you are a current client or not, you have but to ask. I’m here and I remain,
 
Sincerely yours,
 
Chris Amundson
President
Accounting Solutions Ltd.
773-267-7500
 
www.AccountingSolutionsLtd.com
 
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