COVID-19 Weekly Digest (January 20, 2021)
Vaccines for the coronavirus are now being administered around the country, but that does not mean an end to wearing a mask. This article from Kaiser Health News lists five reasons to keep wearing a mask, even after receiving the vaccine. The top two reasons are that no vaccine is 100% effective and that vaccines don’t provide immediate protection. According to one of the experts cited, the best way to end the pandemic is to use masks, social distancing, and vaccines: “The three approaches work best as a team.”
Working together as a team is not only how we defeat the virus, but it’s also how we build a better world.
STIMULUS UPDATES
The Biden Plan
President-elect Joe Biden will be sworn in as the new President this week and plans to hit the ground running. Here are some highlights of his proposed stimulus plan:
An increase of $1,400 to the $600 stimulus payments that are being processed now
Federal unemployment benefits would increase from $300 to $400 per week
Extending the moratorium on evictions and foreclosures until September 30
$350 billion for state and local governments
$130 billion to help schools reopen
$50 billion for COVID-19 testing
$20 billion to help with a national vaccination program
Increasing the Child Tax Credit to $3,000 per child and making it refundable
His package also includes a push to raise the federal minimum wage to $15 per hour. Many leading economists warn that additional support from the federal government may be needed until the pandemic has subsided and people can safely return to work.
Economic Impact Payments
During the first round of stimulus payments, many people who had used TurboTax, H&R Block, or another retail tax preparation service discovered that those payments were going to the wrong accounts. The same snafu hit again with the current round of payments, but those companies sorted out the problem much faster this time around. The IRS has updated the Get My Payment tool to get information about how their payment was sent and the date it was sent. Taxpayers who do not receive their payment via direct deposit should be on the lookout for either a paper check or a prepaid debit card. You can find more information on the current round of payments by checking the IRS Frequently Asked Questions.
If you’re eligible for payment but don’t receive it by the end of January, your only option is to claim it as a Recovery Rebate Credit on your 2020 tax return. If you’re eligible for a more significant payment than you received, you can claim the difference on your 2020 tax return.
Paycheck Protection Program (PPP)
The latest PPP round opens to all lenders on January 19 after opening first to smaller banks and community financial institutions. This new round is open to businesses that did not receive funding in the previous round, as well as to businesses that are seeking a second loan.
This article in the New York Times answers questions about the new round. For first-time borrowers, the loans are capped at $10 million. These borrowers need only attest that “current economic uncertainty makes this loan request necessary.” For the second round, loans are capped at $2 million and must demonstrate a decrease of at least 25% in gross receipts compared to 2019. Borrowers must use at least 60% of the proceeds to pay employee wages. The remaining 40% can be used for rent, utilities, and mortgage interest payments, as before. The new stimulus law expands the categories of allowable expenses to include payments to suppliers, PPE equipment for workers, and certain kinds of property damage. Loans will be forgiven if proceeds are used for these approved expenses. Loans may not be funded as quickly in this round because lenders must do more vetting to prevent fraud and misuse.
More details are available on the SBA website.
TAX ISSUES
Usually, the tax filing season begins in mid to late January, but this year, the IRS will not begin accepting returns until February 12. Reasons for the delay include new programming needed to incorporate the Recovery Rebate Credit on tax returns. This means that some early filers will not receive refunds until early March. Because the IRS is still processing the backlog of mail accumulated when the agency shut down last spring, electronic filing is highly recommended.
LIVING WITH THE PANDEMIC
Working from home
Is working from home more productive than in an office? Surveys cited by an article in the Wall Street Journal indicate that it has been for some people. About 41% of survey respondents said it was better than 43% who saw no difference, and 15% thought it was worse. Before the pandemic, only about 27% would have preferred working at home, while about 80% of those working at home in June and July of 2020 would like to continue working at home at least three days a week after the pandemic subsides. However, in another survey, most of those working at home seemed to be working more than the pre-pandemic average of 8.5 hours per day.
The Future of Work
The Wall Street Journal’s latest issue of The Future of Everything focuses on the future of work with a wide-ranging assortment of short articles. What will our desks be like? Mobile, virtual, reclining, or converting into modular shelf units? Or, will private desks disappear in favor of shared work areas where team members can meet when they’re in the office? Managers in the future may spend more time coaching employees and less time ordering people around.
