Welcome to our new insurance agency blog!
 
This is our very first post. We're not quite sure what we're going to write about here, but the plan is to create helpful content for customers and prospective clients about information that is relevant to you.
 
We hope you'll come to view this as a top resource for keeping your family and your finances safe.
 
Here are a few of the topics we may be writing about:

• Answers to clients' frequently asked questions.
• Helpful information about insurance shopping.
• Safety and Health Tips and Ideas.
• Local Community Information.

 
Stay Tuned!

Emergency Paid Sick Leave
For employers with fewer than 500 employees the legislation makes the employees eligible for paid sick leave without regard to the duration of their employment with the company. Thus, if an employee is unable to work, or work from home, for any of the following reasons they qualify for paid sick leave.

• Is subject to federal, state, or local isolation or quarantine order related to COVID-19
• Has had a health care provider advise them that they should self- quarantine as a result of concerns related to COVID-19 (self-quarantining does not qualify).
• Is seeking medical diagnosis as a result of having symptoms of COVID-19.
• Is caring for somebody (not necessarily a family member) who is subject to a federal, state, or local isolation or quarantine due to COVID-19; or who has been advised to self-quarantine by a health care provider as a result of COVID-19.
• If the employee’s child’s school or care facility has been closed or is unavailable as a result of COVID-19 and the employee needs to care for the child.

The Act also includes a provision that an employee qualifies if the employee Is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of the Treasury and the Secretary of Labor.

Hours of Sick Leave Time:

• Full-Time Employee: 80 Hours
• Part-Time Employee (regularly scheduled hours): Same number of hours they would normally work during a two-week period.
• Part-Time Employee (sporadic hours): Special calculation method.
• Sick Pay Benefit:
• For reasons 1 through 3, above: Normal rate of pay but limited to a maximum of $511 per day and a total of $5,110.
• For reasons 4 and 5: Two-thirds of their normal rate of pay but limited to $200 per day and a maximum of $2,000.
• Employee Accrued Paid Leave – The Act specifically prohibits employers from requiring employees to use other accrued paid leave before using the emergency leave.
• Existing Paid Sick Leave or Paid Time Off - Any existing paid sick leave or paid time off is separate from Emergency Paid Sick Leave and remains with the employee.
• Note: - Employees are not required to provide advance notice before the first day that they take paid sick leave.

For questions email: info@taxesdoctor.com

REPEAL OF MAXIMUM AGE FOR TRADITIONAL IRA CONTRIBUTION:  Starting Jan 1, 2020, the rule that you aren’t able to make contributions to your traditional IRA for the year in which you reach age 70.5 and all later years has been repealed.

REQUIRED MINIMUM DISTRIBUTION AGE (RDM):  Starting Jan 1, 2020, the age for the required beginning date for mandatory distribution is changed to 72 for taxpayers reaching the age of 70.5 after Dec 31, 2019.

Small Employer automatic enrollment credit:  The Further Consolidated Appropriations Act (FCAA), 2020, P.L 116-94, added section 45T. An eligible employer may claim a tax credit of $500 per year over a 3-year period beginning with the first tax year after Dec 31, 2019 when it sponsors a qualified employer plan including an eligible automatic contribution arrangement. 

Increase in credit limitation for small employer plan startup costs: The FCAA amended section 45E . For Tax year 2020 a small employer can claim a tax credit for first year and 2 years immediately following for up to 50% of qualified startup costs, between $250 to $500 per employee or up to $5,000.

Qualified automatic contribution arrangement (QACA) safe harbor plans:  Starting in tax year 2020, when an employee doesn’t make an affirmative election specifying a deferral percentage. The maximum default deferral percentage increased from 10 % to 15%.

Retirement savings contributions credit:  Retirement plan participants (including self-employed individuals) who make contributions to their plan may qualify for the retirement savings contributions credit (RSCC). The maximum contribution eligible for credit is $2000. Taxpayers are eligibile for the RSCC if there are 18 years of age or older, not a full-time student and not claimed as a dependant on another person’s return.

Small Business retirement plans:

1. SEP (Simplified Retirement plan) 2. SIMPLE (savings incentive match plan for employees) plan 3. Qualified plans (H.R. 10 plans or Keogh plans for self-employed individuals) including 401(k) plans
2. SEP, SIMPLE and qualified plans are tax deductible to the employer and tax deferred for the employee. Earnings on the contributions are also generally tax free until distributions from the plan are received. 
3. Under a 401(k) plan, employees can contribute limited amounts of their before-tax pay to the plan (after-tax pay in case of Roth IRA). These contributions (and earnings) are tax free until distribution under the 40l(k) plan and the distributions are tax free in case of designated Roth account (IRA). 

Any Questions email at info@taxesdoctor.com

Retirement plans for Small Business (SEP, SIMPLE, and Qualified plans)
Reference: IRS.gov/Pub560

Compensation Limits: The maximum compensation used for figuring contributions and benefits is $280,000 in 2019 and $285,000 in 2020.

Elective deferral Limits: The limit is $19,000 for 2019 (other than catch up contributions) and increases to $19,500 in 2020.

Limits apply for participants in SARSEPs, 401(k) plans (excluding SIMPLE plans), Section 403(b) plans and section 457(b) plans.

Defined contribution limits on 2019 and 2020: For 2019: $56,000 (other than catch up contributions) and  2020: $57,000

Defined benefit limit:  The limit on annual benefit for a participant in a defined benefit contribution is  for 2019: $225,000 &  2020: $230,000

SIMPLE Plan Salary reduction contribution limit for 2019 and 2020:  Limit on salary reduction is in 2019: $13,000 (other than catch up contribution): In 2020 $13,500

Catch up contribution limits for 2019 and 2020

A plan can allow a participant who are age 50 or over at the end of the calendar year to make catch up contributions in addition to elective deferrals and SIMPLE plan salary reduction contributions.   The Catch-up contribution limitation for defined contribution other than SIMPLE plans is $6000 in 2019 and $6500 in 2020. The Catch-up Contribution limit for SIMPLE Plan is $3000 for 2019 and 2020. 
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If you have questions email at info@taxesdoctor.com

On March 27, 2020, the President signed the Coronavirus Aid, Relief and Economic Security Act (CARES Act) to provide emergency financial and health care assistance to individuals and businesses affected COVID19.  The CARES Act has set aside some funds for small businesses to receive an economic disaster loan from the U.S. Small Business Administration  (SBA) for some relief from the hardship and to protect the paycheck of employees of the affected small businesses.  The PPP loans will be 100% guaranteed by SBA, and the full loan principal may qualify for loan forgiveness.  The program is for small businesses with less than 500 employees both for profit and non-profit entities are qualified to tap into $350 USD set aside for this progam.

The maximum limit is $10 Million USD based on a businesses payroll expenses.  The money is available on a first come basis and it is now (April 6, 2020) available through SBA lenders that participate in the SBA 7(a) Loan program.  Check with your financial institution and apply online since most banks have to preference to work with their existing customers.  More to follow on the specifications of the PPP loan. Feel free to send an email at info@taxesdoctor.com if you have any specific questions.