Tax and Finance Management

Key Tax Credits in the Senate’s Coronavirus Relief Package

OMA Connections Partners RSM has published this helpful summary of the U.S. Senate Republicans’ $1 trillion coronavirus relief package introduced this week. The following provisions, which did not receive much media attention, are included in the bill:

• A significant expansion of the employee retention credit;
• A new hiring incentive to target workers who lost their jobs due to the pandemic;
• A new payroll tax credit to give employers a 50% credit for expenses incurred for PPE, cleaning supplies, and other various workplace safety expenses;
• A tax credit to encourage the manufacturing of designated types of PPE; and
• A provision under which the business meal deduction would be temporarily increased from 50% to 100% for food or beverage expenses provided by a restaurant.

Also, check out the summary by the National Association of Manufacturing, which spotlights the bill’s liability protections for businesses. 7/29/2020

PPP Loan Forgiveness Applications Can Be Submitted Starting Aug. 10

The Small Business Administration will begin to accept Paycheck Protection Program (PPP) loan forgiveness applications on Monday, Aug.10. To help you prepare your application and avoid delays, OMA Connections Partner GBQ Partners has prepared this insight and checklist for businesses. 7/30/2020

IRS Provides Guidance on Recapture of Excess Employment Tax Credits

The IRS has issued guidance in the form of temporary and proposed regulations relating to the recapture of erroneously issued employment tax credit refunds tied to the Families First Coronavirus Response Act’s paid sick and family leave tax credit, as well as the CARES Act’s employee retention tax credit. Read the temporary regulations and the proposed regulations. 7/29/2020

IRS Issues Guidance on Business Interest Expense Deduction Limits

The IRS has issued final regulations regarding the provision of the Tax Cuts and Jobs Act that limits the deduction for business interest expense, including basic statutory amendments made by the CARES Act. See the IRS’ press release here. 7/29/2020

Main Street Lending Program: A Financial Resource in Reserve

The Federal Reserve’s new Main Street Lending Program isn’t getting much use now, but it will be an important safety net should COVID-19 cases create the need for more economic shutdowns. OMA Connections Partner Plante Moran has published this new insight on what companies should know about the program. 7/24/2020

Legal Challenge Posed to Ohio’s Local Income Tax

A conservative think tank in Ohio has challenged a recent state law intended to protect local income tax revenue during a time when many employees are working from a different municipality than their employer’s workplace.

Earlier this year, the OMA and numerous other business interests supported House Bill 197, bi-partisan legislation that contained numerous COVID-19 relief measures. HB 197 won unanimous approval in the General Assembly in late March and contained a provision to extend Ohio’s “20-day rule” for municipal tax withholding for employees who are now working from home.

The Buckeye Institute argues that allowing cities to continue collecting taxes from employees who are now working in other municipalities is an unconstitutional expansion of their taxing authority. WOSU radio reports on this development. The lawsuit is pending in the Franklin County Common Pleas Court. The OMA Tax Committee will discuss the issue at its next meeting. 7/16/2020

Ohio’s Revenue Collection Falls $1.1B Short of FY 2020 Forecast

The Office of Budget and Management (OBM) recently released its full monthly financial report for June, showing Ohio ended FY 2020 roughly $1.1 billion (4.6%) below budgeted estimates.

The report notes that Ohio’s non-farm payroll employment increased to 4.83 million jobs in May, a 2.7% increase over April — including 19,000 new manufacturing jobs. Despite the increase, non-farm employment remained 13.6% below last year’s levels. 7/13/2020

Tax Foundation Reviews Legislative Proposals to Boost U.S. Manufacturing

The non-partisan Tax Foundation has published this review of several federal proposals to reshore and/or expand manufacturing in the U.S. The Foundation cautions that “before creating subsidies in the form of tax credits, policymakers should make sure that the current tax code is not biased against these factories coming to the U.S.” 7/14/2020

RSM ‘s Tax Insights, Manufacturing Insights for July

OMA Connections Partner RSM has published its Tax Insights newsletter for July. Among the topics discussed are transfer pricing policies, tax planning under the CARES Act, and payroll tax credits and deferrals for employers.

RSM has also published its monthly Manufacturing Insights newsletter. 7/13/2020

SBA Disaster Relief Loans Available for Licking, Muskingum, Delaware, and Franklin County Businesses

Storms and flooding in late March devastated homes, local businesses, and communities around Central Ohio. In response, the Small Business Administration announced low-interest loan assistance for businesses affected by these floods.

July 20 is the deadline to apply for one of these loans that cover uninsured or under-insured losses. Business owners can borrow up to $2 million for damaged real estate and other business assets, for economic injury, or a combination of both. You can contact Congressman Balderson’s office for assistance. 7/8/2020