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Weekly Digests

Weekly Digest – 26 August 2020

In the past, automation and technological advances created more jobs than it disrupted, and innovation has greatly improved our lives. However, as this article in the Wall Street Journal reports, economists caution that the COVID-19 pandemic may have accelerated the changes that have already been happening for the last several decades which may be creating a divide between skilled and low-skilled workers. “For many professionals, technology has been a lifeline during the pandemic, enabling them to be productive while stuck at home. For many other workers, it is a new dividing line, corralling them further into the stagnant corners of the economy.” The challenge for the future will be to help people whose livelihoods are being disrupted while supporting the improvements and efficiencies that technology brings us.

Here are a few of the important stories from the last week to help you stay healthy, safe and productive!

CARES ACT UPDATES

Executive Actions for Pandemic Relief

The payroll tax deferral from President Trump’s executive memorandum is getting little traction among business leaders, who note that it could saddle employees with a hefty tax bill in 2021. Many companies are signaling that they will not participate, citing the potential unfairness to workers and the difficulty of implementing it. An employee earning $35,000 could see a bill for $751, while the highest eligible earners could owe $2,232. So far, the IRS and Treasury have not created guidance for employers or payroll companies to implement this temporary deferral.

So far, 11 states have been approved for the additional $300 per week in unemployment benefits offered in an executive action from President Trump: Arizona, Colorado, Idaho, Iowa, Louisiana, Maryland, Missouri, Montana, New Mexico, Oklahoma, and Utah. However, the additional funds are only guaranteed for three weeks, and the timing for those benefits isn’t yet clear.

Economic Impact Payments (aka Stimulus Checks)

Although Congress still hasn’t passed a second stimulus program, a second round of payments is likely to be a part of it. For those anxious to receive those funds, CNet has put together a tentative schedule for when those payments might go out, depending on when Congress passes the legislation. For example, if the Senate passes a bill on September 8, payments could be headed out as soon as the week of September 21.

Paycheck Protection Program (PPP)

Do you have questions about how forgiveness will work with the PPP? JD Supra put together a useful guide with explanations of covered periods, allowable payroll expenses, and the forgiveness application process.

TAX ISSUES

The IRS created a new webpage with information about operations during the pandemic. Due to the continued shutdown of some operations, they are requesting electronic filing of returns when possible. The page also has a comprehensive list of online sources of help, which is preferable to calling as wait times tend to be significantly longer than usual. Other announcements on the webpage:

  • Some Taxpayer Assistance Centers are open; however, appointments are required. Call 844-545-5640 to make an appointment.
  • The IRS is working through its backlog of correspondence.
  • Included in that backlog are payments by check, which will be credited to accounts as of the date the payment was received, not the day it is processed.
  • If you received a notice from the IRS regarding a past-due payment, check the last page of the enclosed insert, Notice 1052, for a new due date.
  • The IRS has suspended mailing notices of past-due tax balances until it resolves the backlog of correspondence.

If you mailed a check to the IRS, and it still hasn’t been cashed, here’s what to do. Don’t stop payment on the check, don’t spend the money, and be patient while the IRS resolves its mass of unprocessed mail.

HELP FOR SMALL BUSINESS

Main Street Lending Program

A Congressional panel is urging the Federal Reserve’s Main Street Lending Program to broaden its reach to include more small- and medium-sized businesses and a broader cross-section of businesses. As of August 19, the Fed had repurchased $472 million in loans out of a total $600 billion authorized for the program. Additional FAQs were posted on July 31 for small businesses, and on August 6 for nonprofit organizations. Prospective borrowers should review the Boston Fed’s borrower page, and contact a participating lender.

WORKING FROM HOME

Working from home isn’t for everyone, and isn’t the same for everyone. Some are better at it, some not so much. This piece in Fast Company offers tips for working with people who aren’t good at working remotely. Understanding your co-workers’ situations and personal preferences can help mitigate issues. Being predictable while also remaining flexible makes it easier for others to work with you. While empathy can be difficult to show over a Zoom connection, your co-workers will appreciate the gesture.

Longer hours, more emails and shorter meetings are three ways that work has changed during the pandemic, according to a new study. Longer workdays may be a reflection of flexible work schedules that allow employees to take breaks for domestic duties. The study also found that while people were attending more meetings during the day, those meetings were shorter than those in the office, and have been steadily decreasing in duration.

Working from home, however, sometimes means that employees have to provide the amenities that make for a pleasant workplace. In response, some companies are providing employees with stipends so they can buy chairs, office supplies and even the snacks that employees used to get for free in the office.

Before returning to work, it’s a good idea to get your financial house in order. Advisors interviewed by the Wall Street Journal made a number of suggestions to workers going back to work that may prevent financial disaster in case they contract COVID-19. Having a minimum three- to six-month emergency fund was the recommendation prior to the pandemic. Now some advisors are recommending a reserve that would cover 12 to 18 months without work. Checking health insurance coverage and sick leave policies are also prudent ideas. As the pandemic reminded us, it’s never too early to have a will and a medical power of attorney in place. Parents of young children may also want to consider guardianship issues. Returning to the office can also lead to increased expenses for transportation, childcare and meals.

LIVING WITH AND AFTER THE PANDEMIC

Work in the post-pandemic world

While immediate concerns for the return to work center around keeping team members healthy and minimizing the possible spread of infection, the office as a place to work will need to evolve. The primary advantage of the office is the ability to collaborate, but with some members working remotely and social distancing requirements for those who do come in, new and better ways to collaborate will need to be developed. Remote workers need different kinds of support if they are to be equal partners with those in the office.

Working from home used to be viewed as suspect, and as inherently less productive than keeping everyone in the office. But some companies are finding that their all-remote teams have been productive enough that they are moving to a four-day workweek. Companies that were already using an abbreviated workweek are also reporting that they had an easier time transitioning to working remotely. Even after returning to the office, a four-day workweek with staggered schedules can make it easier for workplaces to comply with social distancing, and will make it easier to attract scarce highly skilled employees.

GENERAL RESOURCES

We sincerely hope that you and your family are well and remain well. If you have any questions or concerns, don’t hesitate to reach out to us. We are all in this together!

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