Many of these additional stimulus measures, like the additional round of Economic Impact Payments, provide much needed financial assistance for Americans impacted by the global pandemic. Some, like the Special lookback for Earned Income Credit and Child Tax Credit, are even targeted at helping workers who experienced lower wages this year, due to the pandemic, to get a larger refund that is consistent with their earnings from prior filing seasons. For tax professions, it's more critical than ever to communicate the applicable changes to your clients at the right level. Meeting with your clients soon to take advantage of the right provisions will be essential.
Here are insights from specific provisions that might be especially impactful to your clients:
- Unemployment Insurance: The extension was critical in preventing as many as 14 million Americans from losing this economic lifeline at the end of the year. Tax professionals can be of the most help by assisting clients in staying informed and up-to-date on state’s guidelines.
- Paycheck Protection Program Loans: Tax professionals can help their clients to determine PPP loan and forgiveness eligibility and with applications for the program. In addition, encourage clients to keep all PPP funds separate and to keep important records.
- Extension of the Employee Retention Credit: The extension of this tax credit will help keep additional U.S. workers on payroll and more small businesses and nonprofits across the country afloat. Tax professionals can help their clients make the important determination of whether to take the Employee Retention Credit or a Paycheck Protection Program loan.