This webinar reviews an overview of a Proposed CARES Act but focuses on one key component, the SBA program, passed by the Senate (still needs to be approved by the House of Representatives). Under the current draft of the Cares Act, the SBA could be authorized to guarantee up to $349 billion in 7(a) loans to businesses with not more than 500 employees. This could affect many business owners.
How does this affect your business? McMill CPAs & Advisors as well as banking leaders explored this topic together in a round-table format.
3/26/2020
Category: Uncategorized
WEBINAR – Market Review 3.26.20
EDUCATIONAL CONTENT DISCLAIMER The content provided within this video/ website/social media platforms, e-mail transmissions, video, pictorial, or any associated media (hereinafter collectively referred to as “Information”) is provided for educational purposes only and is not and should not be construed as professional financial, investment, tax, or legal advice. This is not investment or trading advice nor a solicitation or recommendation to purchase or sell securities, nor solicitation of an offer to purchase or sell securities, nor an attempt to influence the purchase or sale of any security. Past performance is no guarantee of future results. Whenever there are hyperlinks to third-party content, this information is intended to provide additional perspective and should not be construed as an endorsement of any services, products, guidance, individuals or points of view outside McMill Wealth Management/Wealth Management LLC. Please contact us for more complete information based on your personal circumstances and to obtain personal individual investment advice. Despite efforts to be accurate and current, this presentation may contain out of date information. Additionally, McMill Wealth/Wealth Management LLC will not be under an obligation to advise you of any subsequent changes. McMill Wealth Management and Wealth Management LLC are registered investment advisors with the Securities Exchange Commission. Slide Sources Fastest Correction – https://finance.yahoo.com/news/stock-… Don’t Bail on the Lows, Stick Around for the Highs – Source: FactSet, Standard & Poor’s, J.P. Morgan Asset Management. Returns are based on price index only and do not include dividends. Intra-year drops refers to the largest market drops from a peak to a trough during the year. For illustrative purposes only. Returns shown are calendar year returns from 1980 to 2019, over which time period the average annual return was 8.9%. Guide to the Markets – U.S. Data are as of December 31, 2019. Past performance is not an assurance of future results. Values change frequently and past performance may not be repeated. There is always the risk that an investor may lose money. Securities of small firms are often less liquid than those of large companies. As a result, small company stocks may fluctuate relatively more in price. Even a long-term investment approach cannot ensure a profit. Economic, political, and issuer-specific events will cause the value of securities, and the funds that own them, to rise or fall. Because the value of investments will fluctuate, there is a risk that investors will lose money. Bear Markets since WWII – Source: Murray, Nick. Simple Wealth, Inevitable Wealth. Nick Murray Company, Inc., 2019 S&P Performance Following Historical Events – https://www.capitalgroup.com/advisor/… Market Downturns and Recoveries – Past performance is no guarantee of future results. This is for illustrative purposes only and not indicative of any investment. An investment cannot be made directly in an index. Downturns are defined by a time period when the stock market value declined by 10% or more from its peak. © Morningstar 2020. All Rights Reserved. U.S. Market Recovery After Financial Crises – Past performance is no guarantee of future results. Returns reflect the percentage change in the index level from the end of the month in which the event occurred to one month, six months, one year, three years and five years after. This is for illustrative purposes only and not indicative of any investment. An investment cannot be made directly in an index. © Morningstar 2020. All Rights Reserved. Focus On What You Can Control – Diversification does not eliminate the risk of market loss. There is no guarantee investment strategies will be successful. For illustrative purposes only.
Nebraska Chamber on Unemployment Options
The Nebraska Chamber hosts Nebraska Department of Labor Commissioner John Albin & General Counsel Katie Thurber for a briefing on Nebraska’s unemployment programs during the coronavirus outbreak.
Tuesday, March 24, 2020 3:30 p.m. CDT
WEBINAR – COVID-19
Regarding Business Implications on Cash Flow and Employment Issues
Addressing how the current changes impact business owners. Topics covered will include: Proactive Business Practices, Common Questions to Address in Planning, Available Financial Assistance, Credit Options – Including the SBA Program, Families First Coronavirus Response Act, Emergency Family and Medical Leave Expansion Act, Emergency Paid Sick Leave Act, Upcoming Potential Legislation: CARES Act, State Unemployment Updates and Payroll Tax Credits
3/24/2020
Ricketts extends tax filing deadline, praises crowd compliance
Gov. Pete Ricketts announced Monday that Nebraska’s state income tax filing deadline would be moved from April 15 to July 15, matching the three-month federal extension already granted by the Internal Revenue Service.
But the governor urged Nebraskans who have not been significantly impacted by the economic fallout resulting from the spread of the coronavirus to try to meet the traditional deadline to help ensure the healthy cash flow that’s needed to support state government.
In a wide-ranging discussion during what has become a coronavirus briefing by the governor every weekday, Ricketts said:
* The state is looking for quarantine space to house people infected by the virus in case that might be necessary.
* There are no plans to move beyond the 10-person limit for public gatherings; that is “the most restrictive measure we are anticipating.”
“Never did we discuss a shelter-in-place strategy,” he added. “For our state, that is not necessary.”
* Expanded testing for the virus is now underway, but testing will be directed at “the highest priority cases.”
* Rumors that the state is considering calling the Nebraska National Guard into active duty to impose martial law are bogus.
Todd Becker, CEO of Green Plains Ethanol, joined the governor at the briefing to announce that his company will donate industrial alcohol that it produces at its York plant to be transformed into hand sanitizer during the current emergency that has resulted in a reduction in gasoline demand.
The industrial alcohol will be shipped to the Department of Correctional Services for processing, he said.
“Our employees and our company are proud to help,” Becker said.
Ricketts said he believes Nebraskans have responded to the challenge and “slowed the spread of the virus” in the state by complying with the 10-person gathering rule.
“We anticipated 30% compliance,” the governor said. Instead, he said, there has been “almost universal compliance.”
“I can’t tell you when we get back to normal,” Ricketts said, “but we will get through this.”
The governor’s afternoon briefing came on a surreal day at the Capitol when the Legislature met in a protected cocoon with doors closed and no access to the floor of the legislative chamber in order to process emergency legislation appropriating $83.6 million to battle the virus.
That included $25 million that was added to the governor’s request for funding and will be held in reserve for unanticipated needs.
“I did not ask for that,” Ricketts said. “The Legislature decided that would be prudent (and it provides) more cushion for us to work with.
“This is going to be a tough time for everybody,” the governor said, a time when Nebraskans should try to help one another and support small businesses.
Under direction from the state, bars and restaurants in the Omaha area have moved to take-out, drive-thru and delivery service only.
“If you’re an employer thinking long-term,” Ricketts said, “you (may want to) figure out ways to hold on to your workforce.”
And landlords ought to take into consideration the financial stress that some Nebraskans may be encountering when it’s time to pay the monthly rent, he said.
It may be a time for “a moratorium on evictions,” Ricketts suggested.
“It’s a public emergency … you can’t be throwing people out on the street,” he said.
“I want to thank every Nebraskan who has been working to slow the spread of the coronavirus,” the governor said. “Nebraskans have stepped up to meet that challenge.”
Tax Filing Deadline Update
Secretary Steven Mnuchin announced that the April 15th tax filing deadline will be extended to July 15th. This extension applies to federal income tax only.
Nebraska has not extended filing or payment deadlines at this time.
The tax payment extension applies to federal tax due with 2019 tax returns, plus 2020 first quarter tax payments. Any tax due in excess of these aggregate amounts is due on the normal due date and is not extended.
McMill CPAs & Advisors recommends you to file before April 15th, and pay any tax owed by July 15th.
Tax Deadline & Market Update
TAX DEADLINE
(3/18/20)
Details on the payment extension issued by the IRS:
- ● April 15th, 2020 remains the deadline for filing taxes.
UPDATE 11:30am 3/20/20: The Treasury Secretary recently announced the federal filing date will be July 15th, 2020. - ● There has been a 90 day extension (to July 15th, 2020) for all federal payments normally due on April 15th, 2020. It would include the first quarter estimated tax payment.
- ● At this time, Nebraska has not extended the time to file or pay taxes. However, other states have begun issuing extensions for time to file and pay. We will keep you informed as developments occur with the state tax deadlines. UPDATE 3/23/20: It was announced the filing and payment deadline will be July 15th, 2020.
Please talk to your tax preparer if you have questions on any of these deadlines. McMill CPAs & Advisors will issue additional communication if any of these deadlines change.
MARKET VOLATILITY
The stock market can be compared to a roller coaster ride. It’s slow and gradual going up, but when it starts to drop, it happens quickly and your stomach turns flips.
We are in a period of volatility right now. The volatility we are seeing right now is actually a sign that the markets are doing what they always do: translating rapidly unfolding information into stock prices. In recent days, the increase in volatility in the stock market has resulted in renewed anxiety for many investors. While it may be difficult to remain calm during a substantial market decline, it is important to remember that volatility is a normal part of investing.
Here are three good things to remember as the markets swoop and dive.
1. We have survived similar events before.
- ● 2002 it was SARS
- ● 2009 it was H1N1
- ● 2012 it was MERS
Each time, the markets reacted to the uncertainty. This virus will peak and decline in the US just as it is already doing in China. When it does, we will see the markets turn around, as they always have.
2. Every time a share of stock is sold, a buyer believes that purchasing that share at that price represents an opportunity to make a profit in the future. People who bought stocks today did so expecting to make money.
3. For long-term investors, reacting emotionally to volatile markets may be more detrimental to portfolio performance than the drawdown itself. Research proves it time and time again: emotional reactions to market swings do not advance your long-term financial goals.
We could repeat, “don’t panic,” and “wash your hands”. Instead, let’s focus on this suggestion: Stay Diversified, Stay YOUR Course!
COVID-19 NEWS
Update from Tom Hanks in quarantine March 17, 2020. Tom and his wife were diagnosed with COVID-19 and have been released from the hospital in Australia.
“Hey folks. Good News: One week after testing Positive, in self-isolation, the symptoms are much the same. No fever but the blahs. Folding the laundry and doing the dishes leads to a nap on the couch. Bad news: My wife @ritawilson has won 6 straight hands of Gin Rummy and leads by 201 points. But I have learned not to spread my Vegemite so thick. I traveled here with a typewriter, one I used to love. We are all in this together. Flatten the curve. Hanx”
China has now closed all temporary hospitals in the central city of Wuhan, the epicenter of a coronavirus outbreak, a news website backed by the Shanghai government, the Paper, said on its official Twitter account on Tuesday.
Apple has reopened all of its Chinese stores, a month after shutting them down amid the coronavirus outbreak.
One of the reasons Italy was hit so hard, experts say, is because they have the oldest population in Europe, and the second-oldest population on Earth (after Japan)
Stock Market Corrections
The average decline for stock market corrections is about 13.7% and they last around four months- unless, of course, they become bear markets, characterized by a dip of 20% or more .-CNBC, February 27, 2020
TAX EXTENDERS AND DISASTER TAX RELIEF
Congress passed and the President signed the Certainty and Disaster Tax Relief Act. Here are a few of the extenders that may affect you:
- If you have canceled debt that is also qualified principal residence indebtedness, you may be able to exclude that canceled debt from income. This provision had expired in 2017, but has now been renewed.
- The deduction for mortgage insurance premiums as deductible qualified residence interest has been extended through 2020.
- The medical expenses deduction floor has returned to 7.5% from 10% for 2019 and 2020.
- The above-the-line deduction for qualified tuition and related expenses has been extended through 2020.
- The employer credit for paid family and medical leave and the work opportunity credit which were slated to expire have been extended through 2020.
- A handful of environmentally-related tax breaks were also extended including but not limited to biodiesel fuels credits, and the credit for purchases of new qualified fuel cell motor vehicles.
- The Act extends the 3-year recovery period to race horses two years old or younger placed in service before 2021.
- And for brewers- the reduction of certain excise taxes related to beer, wine, and distilled spirits.
The new law also tweaked some of the rules regarding disaster relief. Taxpayers who were impacted by a major disaster beginning January 1, 2018, and ending 60 days after the law’s enactment can make tax-favored withdrawals from retirement plans with some restrictions. There is, also an automatic 60-day extension for filing returns for those taxpayers affected by federally declared disasters. The new law also temporarily suspends limitations on the deduction for charitable contributions associated with qualified disaster relief, provides special rules for qualified disaster-related personal casualty losses arising in a disaster area, and provides special rules for determining earned income to taxpayers in designated disaster areas with regards to the Earned Income Tax Credit and Child Tax Credit for the tax year 2018.
Let us know if this article brings up any questions that you may have.
Tax Tips For Individuals
With time left before the April filing deadline, it makes good financial sense to recheck for don’t miss deductions and credits that can lower your tax bill. One caveat: You will have to choose between taking the standard deduction and itemizing individual deductions.
BIG BREAKS
One big break is the adoption tax credit, which is up to $14,080 in tax year 2019 for qualified expenses. It increases to $14,300 for tax year 2020. Another significant break for families with children who qualify by income is the earned income credit, which is up to $6,557 in tax year 2019 (rising to $6,660 for tax year 2020). Remember that you subtract credits from your tax liability while you subtract deductions from your taxable income.
SMALLER SUMS
Don’t forget that qualified education expenses can also help reduce your taxes. Joint filers can take up to a $2,000 lifetime Learning Credit (20% of up to $10,000 of costs) or up to a $2,500 American Opportunity Tax Credit if they qualify by income. You can’t claim both. For those taxpayers who itemize deductions, they may also deduct up to $2,500 of student loan interest, subject to income qualifications.