News + Updates | Category: News

New Rollover Rules for 2020 RMDs

Happy Fourth of July from the Bertz, Hess Professional Service Team!  We are going to keep things very brief as we are all looking forward to kicking off the holiday weekend.  Today we are covering an update on 2020 Required Minimum Distributions (RMDs) and a few other reminders. 

Tax-Free Rollover of 2020 RMDs

As we have discussed in our previous communication, the CARES Act has waived the 2020 RMD requirement for IRAs and other qualified retirement plans.  With the Act being passed in March of 2020, many individuals may have already begun taking their RMDs.  Not only that, the IRS typically allowed a grace period of 60 days to roll the distribution back into their plans.  For many individuals, this grace period had also expired prior to the passing of the CARES Act.

In response to that, the IRS has recently extended the 60-day period to August 31, 2020 in an effort to help those who had already taken their RMD.  This gives the individual the ability to continue to defer the tax if they choose.  Historically, individuals were only allowed one 60-day rollover per 12 months.  These repayments under the CARES Act will not count towards that one instance.  One thing to keep in mind is that plan documents would need to be updated for any of the changes mentioned above. 

Updates and Reminders

July 15th deadline – Yes, we are mentioning it again! There could be a number of income tax payments due on July 15th.  Given the impact of COVID-19 on many small businesses, take some time and consult with our Bertz, Hess & Co. professional team on what makes sense for your 2020 estimated payments.

Where’s my Refund? – For those of you still waiting on your refund, don’t forget that you can check the status at With refunds being delayed, many taxpayers are receiving their refunds plus interest!

Your Bertz, Hess & Co. tax and business advisor will be happy to discuss the options involved with your 2020 RMDs and any other questions that you have!

Thank you and enjoy the holiday weekend! 

The Professional Service Team at Bertz, Hess & Co., LLP

Elimination of the Required Minimum Distribution rules for 2020 – “The IFs”

Greetings again from the Bertz, Hess Professional Service Team! This week we will kick it off with a few updates and reminders, followed by a more robust discussion on the new rules for Required Minimum Distribution (RMD) in 2020.

Updates and Reminders

July 15th deadline – As mentioned in our previous communications, there could be a number of income tax payments due on July 15th. Given the impact of COVID-19 on many small businesses, take some time and consult with our Bertz, Hess & Company professional team on what makes sense for your 2020 estimated payments.

PPP Flexibility Act Highlights – Another topic we wanted to reference from last week are these updates to the PPP Loan program.

  1. Increasing the 8-week timeline to use the loan to 24 weeks
  2. Increasing the amount of allowable non-payroll expenses from 25% to 40%
  3. Increasing the term of the loan from 2 years to 5 years in certain cases

RMD Rules for 2020

The CARES Act waived the requirement to take an RMD from certain defined contribution plans and IRAs for the calendar year 2020. This waiver includes RMDs from Traditional IRAs, rollover retirement accounts and inherited IRAs.

If you do not take part or all of your RMD in 2020, the reduction in income could result in the following potential tax benefits:

  1. Less overall tax on your 2020 tax return.
  2. Less taxable Social Security benefits
  3. Lower cost for your 2022 Medicare coverage.
  4. Increased deduction on Schedule A for out-of-pocket medical expenses.
    Less income taxed on IRS Form 8960 – Net Investment Income Tax.
  5. If you do not take a distribution in 2020 you do not need to take an extra distribution in 2021 or any other future year.

If you normally depend on some or all of your RMD proceeds to pay your living expenses and you have a non-retirement investment account it is possible for you to take advantage of the RMD waiver. You can take the money you need for living expenses from your non-retirement investment account. The money you receive from a non-retirement investment account would be taxable only to the extent that there are gains on the investments sold in order to generate the funds distributed to you. Most likely those gains would be taxed at the lower capital gain rate while IRA distributions are taxed at the higher ordinary tax rates.

If you have not received your RMD for 2020 and you want to take advantage of the RMD waiver you should contact the financial institution who holds your IRA to determine what you need to do to block your RMD for 2020 from being distributed.

If you normally do part of your charitable giving from your IRA by having the contribution sent directly from your IRA to a charitable organization that option is still available for 2020. This distribution is called a Qualified Charitable Distribution (QCD). However, there may be a reason, which is too technical to explain in this brief overview, for you to delay those QCDs until 2021 and then doing double the amount in 2021.

If you have already received some or all of your RMD in 2020 there is potentially a way to undo those distributions based on the date distributed:

  1. If the distribution occurred in January of 2020 currently there is no way to undo those distributions.
  2. If the distribution occurred between 2/1/2020 and 5/15/2020 the distribution would need to be undone by 7/15/2020.
  3. If the distribution occurred after 5/15/2020 the distribution would need to be undone with 60 days after the date of the distribution.

If the distribution you already received was from an inherited IRA there is currently no way to undo a distribution from an inherited IRA.

If you have tax withheld from your IRA distribution and you decide to take advantage of the RMD waiver for 2020 you may need to make estimated tax payments. On the other hand, if you normally pay your tax by making estimated tax payments and you decide to take advantage of the RMD waiver for 2020 you may want to reduce your estimated tax payments.

As you can see the CARES Act waiving the RMD requirements for 2020 created many options for you. Your Bertz, Hess & Co. tax and business advisor will be happy to discuss the benefits of waiving your 2020 RMD and any other questions that you have!

Thank you and enjoy your weekend!

The Professional Service Team at Bertz, Hess & Co., LLP

Employee Retention Credit and More Options

Hello from the Bertz, Hess Professional Service Team! We are excited to reach out to you as we head into the summer months. The school year has ended for many of our children and Lancaster County is moving to Yellow!

This week we will cover the Employee Retention Credit, and many other significant updates and reminders.

Updates and Reminders

Paycheck Protection Plan Loans – Just last evening both the House and Senate signed off on several proposed changes to the PPP Loan program. Major changes include:

  1. Increasing the 8-week timeline to use the loan to 24 weeks
  2. Increasing the amount of allowable non-payroll expenses from 25% to 40%
  3. Increasing the term of the loan from 2 years to 5 years in certain cases

At this point, the President just needs to sign the bill. More to come on this once the President signs!

July 15th deadline – We covered this in our last communication, but it is worth mentioning again. The July 15th deadline is sneaking up on us. For many taxpayers that means as many as three different payments could be due (any amount due with the 2019 tax return, and first and second quarter estimated payments for 2020). If you include state and local estimates, it may be as many as nine different payments due on July 15th. These payments could have a significant impact on cash flow, and many times estimated payments are calculated based on prior year income. Given the impact of COVID-19 on many small businesses, take some time and consult with our Bertz, Hess & Company professional team on what makes sense for your 2020 estimated payments.

Also, keep in mind that not all states extended the second quarter estimated payment to July 15th like Pennsylvania. Among our neighboring states that did not extend the second quarter estimate due date are: New York, New Jersey, Delaware, District of Columbia, Virginia (in addition, Virginia first quarter 2020 estimate was due 6/1/20).

All of the states above have second quarter estimate due dates of June 15, 2020 and first quarter due dates of July 15th with the exception of Virginia as shown. There are many other states that did not extend the estimate dates at all. Again, be sure to consult with one of our professionals so nothing gets missed!

CHECK YOUR MAIL! – Many Economic Impact Payments are being issued on prepaid debit cards. The cards are being mailed in plain white envelopes from “Money Network Cardholder Services”, so be diligent in going through your mail. The envelope will also include instructions with a phone number to call where you establish a PIN and activate the card. If the card is not activated, you will not be able to use it.

Employee Retention Credit

One provision of the CARES Act that we have not spent much time on is the Employee Retention Credit. This credit is available to eligible employers and equals 50% of wages paid to employees during the period of March 13th, 2020 through December 31, 2020. The maximum amount available is capped at $10,000 of qualified wages per employee, which results in a credit of $5,000 per employee. The credit is then applied to the employer’s portion social security taxes. Eligible employers are required to meet the following two criteria.

  1. Operations must be fully or partially suspended during the calendar quarter as a result of orders from an appropriate government authority due to COVID 19; or
  2. Gross receipts for the quarter are 50% less than gross receipts for the same quarter in the prior year.

While the credit is available to employers of any size, it is not available to employers who receive Paycheck Protection Loan. For more detail on this credit, you can review the FAQs at

If you should have any questions, please reach out to your Bertz, Hess & Co. tax and business advisor and we will be happy to help.

Thank you and enjoy your weekend!

The Professional Service Team at Bertz, Hess & Co., LLP

SBA PPP Forgiveness Application & Charity Fraud Alert

Greetings to all as we approach the 2020 Memorial Day weekend! First and foremost, we would like to extend our gratitude to those who have lost their lives serving our country.

We are going to keep things brief this week as we covered a substantial amount of material on our interim messaging regarding FAQ #46, which was recently issued by the Small Business Administration (SBA).

This week we will cover the new PPP loan forgiveness application that has been issued by the SBA, fraudulent charity requests, and some other significant updates and reminders.

PPP Loan Forgiveness Application

The SBA recently released the PPP Loan Forgiveness Application. The application is eleven pages long and includes line-by-line instructions, as well as a schedule of documents that each borrower must submit with the application.

The instructions add some clarity to several key issues as follows:

  • Quantifying your Full Time Employee Equivalents (FTEs)

  • Period for restoring your Full Time Workforce

  • Compensation limits for both owners and FTEs

  • Alternative methods for determining your eight-week period

  • Defining “incurred” versus “paid” payroll costs

  • Guidance on “paid dates” for costs other than payroll

  • Simplified 75/25 cost computation

Click here for the full text of the PPP forgiveness application.

Fraudulent Charity Requests

Unfortunately, during these trying times, it is very common for scammers to try and take advantage of good-natured businesses and individuals. As you can imagine, there have been several reports of people posing as representatives of the Red Cross and other charitable organizations. Below are some things to consider before making any donation.

  • Do some research on-line: Websites like GuideStar and the Better Business Bureau are excellent resources.

  • Be skeptical of high-pressure solicitors: Legitimate organizations do not use these tactics

  • Confirm e-mail addresses: Simply hovering over them may reveal it is not authentic

  • Avoid GoFundMe: This platform offers no verification of what the people are representing

  • Finally, never give credit card, banking or personal information over the phone!

While we do not want to discourage people from being charitable, we do want you to be vigilant and ensure your money is going where you intend it to go! If you want to read more about this, you can enjoy the following Journal of Accountancy article here.

Updates and Reminders

July 15th deadline – The July 15th deadline is sneaking up on us. For many taxpayers that means as many as three different payments could be due (any amount due with the 2019 tax return, and first and second quarter estimated payments for 2020). If you include state and local estimates, it may be as many as nine different payments due on July 15th. These payments could have a significant impact on cash flow, and many times estimated payments are calculated based on prior year income. Given the impact of COVID-19 on many small businesses, take some time and consult with your tax advisor on what makes sense for your 2020 estimated payments.

Economic Impact Payments – There have been mixed reviews on the ability of the IRS to provide information on the status of taxpayers’ Economic Impact Payments. In response to these requests, the IRS has added 3,500 phone operators to handle questions and complaints. Additionally, the Get-My-Payment site is constantly being updated with more and more accurate information.

If you should have any questions, please reach out to your Bertz, Hess & Co. business advisor and we will be happy to help.

Thank you and enjoy this Memorial Day Weekend!
The Professional Service Team at Bertz, Hess & Co., LLP

Good News for Businesses with PPP Loans Under $2 Million!

FAQ #46: Good Faith Certification and Good News!

To our valued clients and business partners:

Good afternoon! We are falling out of our normal communication e-mail schedule to let you know of a new development in the world of PPP.

We have received multiple calls over the last few weeks from clients who had received PPP funds, worrying about whether they “needed” the PPP funds. Due to some disturbing press coverage and correspondence from lenders, combined with some vague language regarding the borrower certification and the law itself, those receiving PPP funds were very nervous about getting a letter (or worse, a visit) from the SBA, who would determine whether they needed the funds, and make them defend that need.

The SBA has provided some clarification that might put businesses at ease, especially those receiving less than $2 Million in PPP funding.

The Small Business Administration (SBA) recently issued new guidance for PPP borrowers within their document of Frequently Asked Questions (FAQs). The complete FAQs guidance can be found here. The focus here is the response to question #46

The updated Q&A provides the much-needed clarity and piece of mind on question 46 that was missing from questions 31 and 39.

FAQ #46 addresses this question: How will SBA review borrowers’ required good-faith certification concerning the necessity of their loan request?

The answer from the SBA is lengthy, but one excerpt is making many PPP recipients very happy:

SBA, in consultation with the Department of the Treasury, has determined that the following safe harbor will apply to SBA’s review of PPP loans with respect to this issue: Any borrower that, together with its affiliates, received PPP loans with an original principal amount of less than $2 million will be deemed to have made the required certification concerning the necessity of the loan request in good faith

• If you are a borrower that received a PPP loan of less than $2 million, you are automatically considered to have certified your need for the loan in good faith. You still need to keep good documentation for forgiveness on how the funds were spent.

• Borrowers with loans greater than $2 million that do not satisfy this safe harbor may still have an adequate basis for making the required good-faith certification, based on their individual circumstances. Documentation becomes very important for PPP loans in excess of $2MM. In documenting your necessity for PPP funds, some focus areas you might consider highlighting:

o Keeping people employed that you would have otherwise laid off or furloughed. Keeping people on the payroll was the primary intent of the PPP.

o Cash Flow issues due to slow paying customers. Just because revenues have stayed consistent, doesn’t mean your customers are paying timely. And it’s very difficult to pay your employees with accounts receivable!!

o Supply chain breakdown causing increased materials costs and lower margins. Lower margins mean lower profit, and higher materials costs result in cash strain.

• If the SBA determines that a borrower lacked an adequate basis for the loan certification, SBA will seek repayment of the loan and will disallow forgiveness of the loan. However, if the borrower repays the loan after receiving notification from SBA, the SBA will not pursue enforcement or referrals to other agencies.

• Also, if for some reason you think your certification was faulty, and you need to give back the PPP funds you received, the SBA (FAQ #47) has pushed the safe harbor deadline to May 18th. It was previously set for today, May 14th.

If you should have any questions about PPP Loans, please reach out to your Bertz, Hess & Co. business advisor and we will be happy to help.

Thank you!

The Professional Service Team at Bertz, Hess & Co., LLP

Getting Back to Business & CARES Act Update

Welcome to the latest edition of the Bertz, Hess & Co. bi-weekly update.  We hope this message finds you well as we move towards re-opening Pennsylvania. 

This week we will be giving a brief update on PPP loans, discussing the EIDL loan program in more detail and also examining the opportunities offered by the CARES Act regarding retirement plans.

PPP Updates

Additional Q&A provided by SBA on PPP Loan details, especially forgiveness and whether a loan is “necessary
The SBA recently added to the Q&A on the PPP. Pay particular attention to questions #31 through #45, as these are the newest additions. Note the increased flexibility for seasonal employers and extended deadline for returning PPP funds if you determine that you should not have received funds under the program.  Go here  to download the FAQ sheet.

Expenses connected to loan forgiveness not deductible
The IRS recently released a notice that addressed the deductibility of expenses paid with PPP loan proceeds.  This has been a hot topic for several weeks now and the IRS has made it clear that any expenses that are paid with funds from a loan that is forgiven are not deductible.  This makes logical sense, since the loan proceeds would not have been picked up as income.  Deducting an expense that is paid with money that was never taxed would essentially be “double dipping”. There are legislators proposing that the IRS allow deductibility of expenses related to PPP, but for now, those expenses remain non-deductible.

What if my laid-off employees refuse a re-hire request and wish to keep drawing unemployment?
Another question that has surfaced over the past couple weeks is with respect to re-hiring workers who had previously been laid off.  This issue was recently addressed by the SBA in a document that can be accessed here.  The final rule will specify that so long as the borrower made a good faith offer, in writing, and the former employee rejects the offer, also in writing, that former employee will be excluded from loan forgiveness reduction calculations.  Documentation is the key!

Economic Injury Disaster Loan (EIDL) Program
While the PPP loan program has received the most attention recently, business owners should also consider the EIDL program.  This program offers up to $2 million in loan proceeds to businesses with less than 500 employees.  If you are in need of money right away, it offers a $10,000 emergency grant that will be forgiven as long as it is used for maintaining payroll, mortgage or lease payments.  This could be an attractive option for small businesses where they have immediate needs other than payroll, as the EIDL program is much less restrictive when it comes to how the funds can be used.  Essentially, the funds can be used for most operational costs, just not to refinance existing debt or pay dividends.  Also, it does not preclude you from applying for and/or receiving a PPP loan.  The interest rate is higher at 3.75% and the term can be up to 30 years.  Contact your lender to apply or apply online at

CARES Act Retirement Plan Provisions
There are three major provisions in the CARES Act that impact retirement plans.  It is critical that taxpayers fully understand these provisions so as to avoid unintended results. 

Waiver of 10% additional tax on early distributions for coronavirus-related distributions – There are two significant items to note here.  First, the funds need to be made to a “qualified individual”.  A qualified individual is someone who is diagnosed with the SARS-CoV-2 virus or with COVID-19 by a CDC approved test, whose spouse or child is diagnosed with such a test, or who experiences adverse financial consequences as a result of being quarantined, furloughed or laid off as a result of the disease, lack of childcare due to the disease, or closing or reducing the hours of a business operated by the individual due to the disease.  Also, while the 10% additional tax is waived, the distribution is still subject to ordinary income tax rates.  In short, be sure you are aware of whether or not you meet these requirements before making a decision.

Limit on loans from retirement plans is increased to $100,000 – The CARES Act increases the allowable amount of a loan from a qualified plan from $50,000 to $100,000.  Similar to the waiver of the 10% additional tax, this increase is only for qualified individuals. 

Waiver of required minimum distributions (RMDs) for 2020 – Prior to the CARES Act, individuals were generally required to take RMDs from certain retirement plans upon reaching the age of 70 ½ or 72.  This requirement is waived for the calendar year 2020.  There is no requirement to be a qualified individual. 

As previously mentioned, it is critical to have a full understanding of these provisions before making any decisions.  The content above serves as a brief summary of these provisions.  Be sure to reach out to your Bertz Hess contact for further discussion.  Here is a link to recently issued FAQs posted to

Getting Back to Business!
Governor Wolf has announced his three-phased plan for getting Pennsylvania back to business.  The “Red, Yellow, Green” is being implemented on a county by county basis with 24 counties moving to Yellow this week.  Details of the plan can be found on the PA Department of Health website at

As always, do not hesitate to reach out to us on any of these topics at 717-393-0767 or email us at

The Bertz, Hess & Company Professional Team

CARES Act Update

Hello again from the Bertz, Hess & Co. team! 

It has now been roughly one month since the CARES Act was enacted into law, and to date, much of the focus has been on the availability of the PPP and EIDL loans made available to small businesses. The Act, however, offers several other provisions of financial relief and assistance. Today, we are kicking things off with some recent developments, followed by a bullet point summary of many of the CARES Act provisions. We then take a deeper dive into the liberalization of the net operating loss rules.

Recent Developments Pandemic Unemployment Assistance (PUA) – Self-employed workers, independent contractors, and gig workers can now apply for unemployment benefits by visiting the following website:

Legislative update – A second relief bill adding another $484 billion in relief has passed both the House and Senate. President Trump is scheduled to sign the bill today. Stay tuned for future developments and updates.

Other CARES Act Provisions

  • Individual recovery payments (AKA – Stimulus Checks)
  • Relief from the 10% additional tax on certain retirement plan distributions up to $100,000
  • Limit on loans from retirement plans is increased to $100,000
  • Required Minimum Distributions from retirement plans are waived for 2020
  • Expansion of the definition of qualified medical expenses
  • $300 above-the-line charitable contribution deduction
  • Increased limits on both individual and corporate charitable contributions
  • Employee retention credit for employers
  • Delayed payment of employer payroll taxes
  • Modification of rules for Net Operating Losses and carrybacks (see below)
  • Modification of limit on losses for noncorporate taxpayers

Net Operating Losses

Have you or your business experienced losses in recent years? The CARES Act temporarily removes the taxable income limitation for most taxpayers to allow an NOL carryforward to fully offset income. For tax years beginning before 2021, taxpayers can take an NOL deduction equal to 100% of taxable income (rather than the 80% limitation in present law). For tax years beginning after 2021, taxpayers will be able to take: (1) a 100% deduction of NOLs arising in tax years prior to 2018, and (2) a deduction limited to 80% of modified taxable income for NOLs arising in tax years after 2017.

The CARES Act also provides that NOLs for most taxpayers arising in a tax year beginning after Dec. 31, 2017 and before Jan. 1, 2021 can be carried back to each of the five tax years preceding the tax year of such loss. Consequently, corporate NOLs arising in 2018, 2019 and 2020 can now be carried back to 2013, 2014, and 2015, respectively. This can be extremely valuable, particularly for corporations, as the maximum corporate tax rate applicable to tax years ending before 2018 was 35%, much higher than the current 21% corporate tax rate. 

Action Required: The IRS generally requires the carryback forms to be filed within 12 months of the last day of the taxable year from which the NOL arises. For a calendar year 2018 NOL, the deadline was December 31, 2019, so the IRS recently issued a six-month extension of time to facilitate those filings. The new deadline is now June 30, 2020. Taxpayers in this situation should act now.

Other General Guidance

Guidance on PPP loan forgiveness – A borrower is eligible for loan forgiveness equal to the amount the borrower spent on the following items during the 8-week period beginning on the date of the origination of the loan: 

  • Payroll costs
  • Interest on the mortgage obligation incurred in the ordinary course of business
  • Rent and utility payments
  • Interest on other debt obligations incurred before February 15, 2020

NOTE: Not more than 25% of the forgiven amount may be for non-payroll costs

Leasing Standards forGAAP Financial Statements – The FASB voted to propose a one-year deferral in the effective date of the leasing standards for certain nonpublic companies that have not already adopted the standards.

Due Dates – Due dates for most forms, payments, installment payments, elections, appeals, exams and returns previously due between April 1, 2020 and July 15, 2020, including extended forms and first and second quarter estimated payments, are now delayed until July, 15, 2020. No extensions are required. 

If you need assistance navigating through the provisions in the CARES Act or other tax and accounting issues, please contact us at 717-393-0767 or email us at  
The Bertz, Hess & Company Professional Team

Cares Act / Stimulus Update

Greetings from the Bertz, Hess & Co.. team!
As we continue to navigate through uncharted waters, our team of tax and accounting professionals remains committed to keeping you informed with all of the latest and most relevant information. Today’s edition will primarily focus on a comparison of the Economic Injury Disaster Loan (EIDL) program and the Paycheck Protection Program (PPP). Other current issues that we will be addressing include the status of unemployment applications in Pennsylvania for the self-employed, fraud guidance with respect to IRS Economic Impact Payments (stimulus checks), and a reminder on the ever-changing income tax due dates.

The CARES Act includes two loan programs that are intended to offer relief to qualifying small businesses and help keep them afloat during the COVID-19 pandemic and related closures. Assuming that your business qualifies for these programs, it is important to understand which loan best suits your needs. Below is a chart that serves as a high-level comparison of the two programs. If you have questions as to whether or not your business qualifies, please do not hesitate to reach out to us.
Maximum Amount: $2,000,000Maximum Amount: $10,000,000
Grant (No Repayment): Up to $10,000Forgivable Amount: 8 weeks of eligible Expenses
Interest Rate: 3.75% (2.75% for non-profits)Interest Rate: 1.0% (balance remaining after forgiveness)
Repayment Period: 10 Years (No prepayment penalty)Repayment Period: 2 Years (No prepayment penalty)
Payment Deferral Period: 1 yearPayment Deferral Period: 6 months
Personal Guarantee Required: Loans over $200,000Personal Guarantee Required: No
Collateral Required: Loans over $25,000Collateral Required: No
Please note that you can apply for both loans, and receive benefits from both programs; however, you can not apply the same benefit dollars to the same expenses. Further, the permitted uses for EIDL funds differ somewhat compared to PPP.

Unemployment for the Self-Employed

The CARES Act provides unemployment benefits to self-employed individuals and independent contractors, which is a significant change in Pennsylvania as it was not previously available for those types of taxpayers. Unfortunately, the current form on the state’s unemployment site is not meant for the self-employed and independent contractors. The PA Department of Labor is asking that these individuals do not submit applications at this time, and that they wait until the proper form is available. There is no estimated date of completion at this time, but we are being told it is a matter of days, not weeks. Due to the overwhelming amount of calls, the best way to correspond with the DOL is via e-mail, which has a turn-around time of about 13 days. For more information go to

 Fraud Alert/ Economic Impact Payments (Stimulus Checks)

The IRS is urging taxpayers to be on the lookout for scam artists trying to use the economic impact payments as cover for schemes to steal personal information and money.

– The IRS will not call, text, email or contact you on social media asking for personal or bank account information – even related to the economic impact payments.

–  Watch out for emails with attachments or links claiming to have special information about economic impact payments or refunds.

For security reasons, the IRS plans to mail a letter about the economic impact payment to the taxpayer’s last known address within 15 days after the payment is paid. The letter will provide information on how the payment was made and how to report any failure to receive the payment. If a taxpayer is not sure they are receiving a legitimate letter, the IRS urges taxpayers to visit first to protect against scam artists.

Due Date Reminder

Below is summary of upcoming due dates for Federal and PA returns. We recommend confirming and double-checking the due dates of any other state and local filing requirements in your area, as due dates, especially for local taxes, have been changing regularly in response to the COVID-19 crisis. Reach out to us if you have questions regarding specific states or municipalities.

               Individual tax return filing and payment                              7/15/20
               (Including HSA and IRA contributions)
               Individual first quarter estimated payment                          7/15/20
               Individual second quarter estimated payment                    6/15/20

               Individual tax return filing and payment                             7/15/20
               Individual first quarter estimated payment                         7/15/20
               Individual second quarter estimated payment                   7/15/20

As always, If you have questions or concerns on how these programs or other provisions in the CARES Act may impact your situation, please reach out to your Bertz, Hess & Company Contact , or contact us at
We wish and you and all those around you continued safety and good health.
The Bertz, Hess & Company Professional Team

Update on Paycheck Protection Program Application Process

Clients and Business Partners:

Earlier this week, we communicated the expected parameters of the Paycheck Protection Program (“PPP”), which is being administered by the SBA and facilitated through various approved banking institutions. The SBA announced that the application process for the Paycheck Protection Program will begin April 3rd.

What This Means For You and Your Business:

The SBA will not accept applications from lenders until April 3rd.  However, we would highly encourage that you start your application process with your lender (or any approved lender) now.

Funds are expected to be limited. Here are some documents to get you started:

·    Paycheck Protection Program (PPP) Information Sheet PPP InfoThis is a good document to read to start to advise you on the decision to apply and the rules around the program.

·    Paycheck Protection Program Sample Application Form –  Sample PPP Application  This is a sample from the Treasury Department’s site. PLEASE reach out to your lender for the their specific application and to understand how they are managing the process. 

Further instructions for how to apply for the aid and additional information are posted on the following Federal sites:
SBA – How to Apply· 
Dept of Treasury PPP Info

Again, you can contact any existing Small Business Administration lender, as well as any FDIC-insured institution, credit union or financial-technology lender that has signed up for the program for relief to aid you in this process. Not all lenders may be participating at this time. Therefore, we highly encourage you to contact them to determine if they are able to assist you.

Bertz, Hess will continue to monitor this and other developments relative to COVID-19 relief actions by the government.

As always, If you have questions or concerns on how these programs or other provisions in the CARES Act may impact your situation, please reach out to your Bertz, Hess & Company Contact , or contact us at

We wish and you and all those around you continued safety and good health.
The Partner Group at Bertz, Hess & Company, LLP

Scott Frick, Laura Bender and Thomas Wobber 

COVID-19 Update 3/31/2020

To The Valued Clients and Business Partners of Bertz, Hess & Company: 

As promised in the last Bertz, Hess & Company message to our clients and business partners, we wanted to update you on some developments over the last few days.  These items may apply to you, your family, your business and/or non-profit entity.  Many of the details have yet to be finalized, but we expect many of the provisions below will be in the final version of these legislative actions. Some of the highlights are as follows:


Everyone seems to be talking about the new CARES Act (The Coronavirus Aid, Relief, and Economic Security Act, H.R. 748), which passed the Senate by a 96-0 vote late on Wednesday and was voted on, and signed into law on Friday. 

There will likely be changes to the CARES Act, but currently, it contains a variety of items affecting individuals, businesses and non-profits as part of a $2 trillion aid package designed to help the economy. Some details of the CARES Act in its current form are covered in a Journal of Accountancy article that you can access here

Some highlights from that article are as follows:

Recovery rebates: Providing individuals with a tax credit of $1,200 ($2,400 for joint filers) plus $500 for each qualifying child. The credit is phased out for taxpayers with adjusted gross income (AGI) above $150,000 (for joint filers), $112,500 (for heads of household), and $75,000 for other individuals.

Payroll tax credit refunds: The bill provides for advance refunding of the payroll tax credits enacted last week in the Families First Coronavirus Response Act.

Employee retention credit: This is a credit for employers that close down as a result of the coronavirus pandemic. Eligible employers are allowed a credit against employment taxes equal to 50% of qualified wages (up to $10,000 in wages) for each employee. Eligible employers are employers who were carrying on a trade or business during 2020 up until the operations were fully or partially suspended due to orders from an governmental authority limiting commerce, travel, or group meetings due to the COVID-19 outbreak. Employers that have gross receipts that are less than 50% of their gross receipts for the same quarter in the prior year are also eligible, until their gross receipts exceed 80% of their gross receipts for the same calendar quarter in the prior year. For employers with more than 100 employees, wages eligible for the credit are wages that the employer pays employees who are not providing services due to the suspension of the business or a drop in gross receipts. For employers with 100 or fewer employees, all wages paid qualify for the credit.

Retirement plans: Taxpayers can take up to $100,000 in coronavirus-related distributions from retirement plans without being subject to the Sec. 72(t) 10% additional tax for early distributions. Eligible distributions can be taken up to Dec. 31, 2020. Coronavirus-related distributions may be repaid within three years. For these purposes, an eligible taxpayer is one who (or that taxpayer’s spouse or dependent) has been diagnosed with SARS-CoV-2 virus or COVID-19 disease, or who experience adverse financial consequences from being quarantined, furloughed, or laid off, or who has had his or her work hours reduced, or who is unable to work due to lack of child care. Any resulting income inclusion can be taken over three years. The bill also allows loans of up to $100,000 from qualified plans, and repayment can be delayed.

Charitable deductions: The bill creates an above-the-line charitable deduction for 2020 (not to exceed $300). The bill also modifies the AGI limitations on charitable contributions for 2020, to 100% of AGI for individuals and 25% of taxable income for corporations. The bill also increases the food contribution limits to 25%.

Payroll tax delay: Employers can delay payment of 50% of 2020 employer payroll taxes until Dec. 31, 2021; the other 50% will be due Dec. 31, 2022. For self-employed individuals, the payment of self-employment taxes falls under the same timeline.

Pennsylvania has provided some guidance on unemployment compensation for employees and self-employed individuals in the COVID-19 guidance which you can access here. At the time of this e-mail, Pennsylvania has not issued guidelines for filing for unemployment if you are self-employed, but has indicated that special instructions are forthcoming.


Here’s what we are hearing from some of our more reliable sources about loans and grants under CARES:

SBA Disaster Assistance for Businesses and Not-For-Profit Entities

  1. The SBA has approved disaster relief funds.  
  2. These funds are provided directly from the SBA and bypass the banks entirely. The best resource for these requests would be to reach out to your SBA district office for guidance. The website will also have up to date information.  
  3. A quick primer on these funds:  up to $2MM to a borrower that is able to show direct hardship and a fixed interest rate of 3.75% for up to 30 years if that amortization makes sense.  One big change is that these funds will also be available to non-profits at a fixed interest rate of 2.75%.
  4. The quickest path to approval is to assemble as complete a package as possible.
  5. Businesses should be prepared with the documentation needed to apply. For example, they will be asked for federal business and personal tax returns, and historical and projected revenue. All businesses are able to review the SBA Disaster Business Loan Application paper forms and requirements  at A complete and thorough application will be eligible for funding (an incomplete application will delay the process.)
  6. The most up-to-date website on SBA’s Disaster Assistance in response to Coronavirus (COVID-19)is:  

Paycheck Protection Program under CARES

  • This program will be administered by the banks, not direct like the SBA Disaster Assistance program.
  • The program is designed to help keep your workers on the payroll.  If you have gone through layoffs, you will be able to hire them back.
  • The dollar amount you will receive will be based on the average monthly payroll using the previous 12 months then multiplied by 2.5.  Payroll means payroll and direct expenses related to payroll such as 401k contributions from the employer, employer contribution for healthcare, and other expenses that have a direct tie in.  Other aspects of monthly overhead is(we are being told by the SBA) not a part of that calculation.  Those expense are covered under the SBA’s disaster relief fund. SO YOU MAY WANT TO START TO GATHER THAT INFORMATION NOW!
  • This program refers to the product as a loan but is in essence a grant.  There is a possibility that some could be a grant and a combo of a loan.  For example, if the formula above leads you to ask for $500,000 and for whatever reason, application not completed correctly, inadequate information supplied, the SBA could say your $500,000 will come as a $420,000 grant and an $80,000 loan at 3.25% over a yet to be determined timeframe.
  • We hope to have details and more clarity on this program by next week.


First, as noted several times above, the information is changing and is being updated constantly   

Second, if you think the two loan/grant programs above would apply to your business, we would recommend you start compiling the payroll information noted above now, or as soon as possible.  Documentation will be key in the process. 

Third, some of the CARES Act relief programs are mutually exclusive, meaning that if you take advantage of one program, you might be excluded from another, so please be careful as you evaluate your options.

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