Business Planning During COVID-19

May 15, 2020

apple podcasts.png  google play.png  spotify.png  iheart.png

This episode of “The Bottom Line” covers how business owners can work with their trusted advisors to properly leverage the COVID-19 government stimulus programs, navigate the tax issues within these programs, and plan for the future when some semblance of normalcy returns. 


Transcript

Dave Plaskow: Hello, and welcome to The Bottom Line. This podcast examines the everyday business and finance issues faced by closely held and private businesses. We hope to provide you with news you can use. I'm your host Dave Plaskow, and with us is Tim Schuster, a senior manager in EisnerAmper's Private Business Services Group. Today we'll discuss with Tim, COVID-19 and some ways businesses should be planning around this pandemic. Tim, hello, nice to virtually be with you.
Tim Schuster: Dave, let me tell you, it's nice to virtually be with you as well.

DP: So, 2020 is turning into quite the year to remember, is it not?
TS: Yeah, Dave. I mean, major world events have been put on hold, in some instances, already through the end of the year, many stimulus bills have been passed and will continue to pass during this pandemic. And another notable addition and business needs is honestly just the way to rethink some aspects of how business will be conducted now and in the future.
DP:Well, let's flush that out a little bit. So, I mean, I can't think of many businesses that haven't been impacted by this global pandemic. And a lot of businesses are really trying to adjust on the fly. What have you been seeing? What have you been hearing from your clients?
TS: This is honestly, truly historic times, that's for sure. And unfortunately there's an element of Darwinism with this. Recently, under the Cares Act, there was a program called the Paychecks Protection Program that was passed. And this is used to help businesses cover the cost of payroll expenses during a designated time period. I personally have been involved in multiple conversations with businesses and all different industries. And there's been a common theme, "What should I be thinking about as a business owner? What does my business look like in the future?" And there are so many additional questions that we are fielding, that honestly, I think, with the tournament is a separate podcast.
DP: Okay, well you are a well-skilled business advisor and you're also a tax expert. So what are some of the tax changes that a business should look to right now?
TS: Exactly. So first step should be to check in with your advisors to help navigate this changing environment. If you do not have an accountant that you work with directly, please find one as soon as possible, and you will need to help with the changes that have occurred. I've mentioned the Paychecks Protection Program before, and spoke about the economic Injury Disaster Loan in a prior podcast, but there are other provisions that your accountant can help you with. So some of the ones that come to mind are new tax provisions that require a change in the minimum distribution for individuals. Net operating losses have new characteristics, post-tax reform. What's notable about this is the suspension of the 80% limitation. And now there's a five-year carryback claim.

Limitation on interest expense was increased from 50% of EBITDA rather than 30%, and a technical correction, which we've been waiting for, any accelerated depreciation of qualified improvement property was fixed. These changes are to help mitigate income taxes, and in some instances with net operating losses and depreciation on qualified improvement property, able to get cash in the business's hands right now.
DP: Okay. Now, let's talk a minute about payroll, because there's a lot of questions around payroll provisions in the Cares Act, and it's somewhat of a quickly moving target. Why don't you tell us about that?
TS: Yes. I spoke about the Families first Coronavirus Act in a prior podcast. Employers and employees could qualify for the expansion of family leave and or the emergency sick leave. These credits are filed through your payroll provider and can help with cash management. Employers also could qualify for retention credit, however, you cannot double dip with the Paychecks Protection Program. Also, to help with cash management, employers can defer employ yours portion of social security. That can add up fast if you have numerous employees. Employers will have to pay those deferrals back 50% of it by the year 2021, and 50% of it by the end of 2022. Some businesses I work with are already receiving their credits on payroll taxes with employees that are on the expanded Family Medical Leave Program. Every little bit can help.
DP:Okay. Now, one day we're going to get out of this tunnel and we'll get back some semblance of normalcy. In looking ahead, what should business owners start to think about now looking forward?
TS: Exactly. So this is where you as an owner need to leverage your accountant and, or your trusted advisor. Now is a great time to revisit your business plan. I was speaking with a client recently about how to transition into online sales, even leveraging virtual reality technology with the products that they sell. If you are not taking the time to rethink how your business will operate with your trusted advisor, you are missing out on the inevitable changes.
I spent a lot of time with different businesses, rethinking plans, which can vary by industry. And for the entrepreneur listener, this is, and will be a lot of opportunities out there. For the here and now, a business really needs to think about cash flow and leverage the programs in effect currently. There will be another phase of federal programs, it's just a matter of what it is. And during this whole process, there will be businesses that fail, and new markets and industries reform. You can help mitigate the former with your advisors. We are on the front lines in a business sense with what's going on in the world.

And honestly, just before we wrap up this podcast, I just want to take and add some final words. Please take time to check in on family, friends and loved ones during this time of dynamic changes. A call or a text message can go a long way, and thank you to the medical professionals on the frontline.
DP:Well, Tim, thank you as always for being an Island of calm in the middle of this storm.
TS: It's my pleasure.
DP:And thank you for listening to The Bottom Line as part of the EisnerAmper podcast series. Visit eisneramper.com for more information on this and a host of other topics, and join us for our next EisnerAmper podcast when we get down to business.

About Tim Schuster

Mr. Schuster is a Senior Manager providing tax compliance services to individual filers, as well as assistance on tax returns for companies in the manufacturing and real estate industries.


More in This Series

What Is An Outsourced CFO?
What Is An Outsourced CFO?

In this episode, we discuss what an outsourced CFO is, when would you want to outsource your CFO and how this can impact the Great Transition.

The 5 W’s of 1099s
The 5 W’s of 1099s

EisnerAmper discusses the who, what, when, where and whys of 1099 forms.

FMLA and Absence Management
FMLA and Absence Management

In this episode of The Bottom Line, Jane Romanowski, from ADP, and Tim Schuster discuss the Family and Medical Leave act.  

What Are The New Overtime Rules?
What Are The New Overtime Rules?

In this episode of The Bottom Line, Jane Romanowski, from ADP, and Tim Schuster discuss the new overtime rules.

Year-End Planning Guide
Year-End Planning Guide

Tim Schuster offers company owners a few proactive things to think about as we approach the end of 2019.

The Importance of Verifying Employment Status
The Importance of Verifying Employment Status

Meredith Brown and Kristen Whelan from ADP join Tim Schuster and discuss the importance of hiring employees who can legally work in the United States.

A Cautionary Tale on Fraud
A Cautionary Tale on Fraud

In this episode we discuss real life examples of instances of fraud and the three factors that incentivize fraud.

State Tax Incentives – Do I Qualify?
State Tax Incentives – Do I Qualify?

In this episode, we discuss some of the ways your business can take advantage of state tax incentive programs, such as through relocation, investment and staff training.

You Mean Employers and Employees Are Not on the Same Page?
You Mean Employers and Employees Are Not on the Same Page?

In this episode we discuss employee vs. employer perspectives.

Employee Benefits That Are on the Fringe
Employee Benefits That Are on the Fringe

Tim Schuster examines some examples of employee benefits, who’s using them, and if they’re having the desired result.

6 Types of Executive Compensation to Consider
6 Types of Executive Compensation to Consider

Tim Schuster discusses executive compensation, option grants, deferred compensation, fringe benefits and more. He also examines what to be aware of when preparing an executive compensation package.

Is There a Difference Between Outsourcing and Private Business Services?
Is There a Difference Between Outsourcing and Private Business Services?

Lindsey Gross of EisnerAmper’s Outsourced Finance and Accounting Group joins Tim Schuster from Private Business Services to discuss the differences between these two areas, client case studies that demonstrate those differences, and which types of client could benefit from each.

You’re Not Using Social Media to Grow Your Business?
You’re Not Using Social Media to Grow Your Business?

This episode of “The Bottom Line” looks at how you can use social media to grow your business. We examine the different communication platforms, how to take the first step, when to post, and some other key points to help foster success.

Pair of New Laws Impacts NJ Workers and Employers
Pair of New Laws Impacts NJ Workers and Employers

This episode of the “The Bottom Line” examines two high-profile NJ legislative initiatives: the Family Leave Act and an increase in the minimum wage. Tim Schuster breaks down the fine points of each and what your business needs to do to get ready.

Creating a Quarterly Planning Calendar
Creating a Quarterly Planning Calendar

A great New Year’s resolution for your business is to develop a quarterly planning calendar. This episode of The Bottom Line has Tim Schuster giving a blueprint for developing this how-to list, including the key action items for each quarter.

The Importance of Having an Emergency Fund
The Importance of Having an Emergency Fund

Are you financially ready in the event of a job loss, extended illness or some other emergency? EisnerAmper’s Tim Schuster offers some helpful tips on creating a fund that can help you sleep a little better at night should a crisis arise.

Why the Sandwich Generation Needs to Talk Finances
Why the Sandwich Generation Needs to Talk Finances

In this episode of The Bottom Line, Tim Schuster talks about the challenges, conversation topics and planning opportunities for members of the sandwich generation—individuals who are responsible for raising their children and caring for aging parents.

New Jersey Sick Leave Goes into Effect
New Jersey Sick Leave Goes into Effect

As NJ initiates paid sick leave, The Bottom Line examines the requirements for business owners, the five reasons for which employees can use sick leave, and what business owners should be doing now to ensure a smooth implementation.

Filling Employment Needs in a Sellers’ Market
Filling Employment Needs in a Sellers’ Market

The economy seems to be chugging along, with unemployment at record lows. The Bottom Line looks at why some of that optimism needs to be tempered and what companies need to do in an increasingly competitive recruitment landscape.

Don’t Postpone Making Your Will
Don’t Postpone Making Your Will

In this episode, Tim Schuster, from EisnerAmper’s Private Business Services Group, tells us why it is definitely not a good idea to be without a will. One key reason: Do you really want the state deciding how to dispense your assets?

Don’t Get Scammed By Someone Pretending to Be from the IRS
Don’t Get Scammed By Someone Pretending to Be from the IRS

The Bottom Line looks at some of the common IRS scams out there, who the bad actors target, what you can do to protect yourself, and what you should do if you fall victim to one of these scammers.

High Court Rules on the Taxation of e-Commerce
High Court Rules on the Taxation of e-Commerce

This episode of The Bottom Line examines the landmark Supreme Court decision in the Wayfair case on e-commerce taxation. Tim Schuster looks at what’s behind the decision, how broad the impact will be, and what you can do to prepare if you sell online.

Employee or Contractor – The DOL’s Watching
Employee or Contractor – The DOL’s Watching

Tim Schuster gives us The Bottom Line when host Dave Plaskow recently received a NJ Department of Labor questionnaire concerning some freelance writing assignments from a couple of years ago.

NJ Budget Mixes Some of the Familiar (and Not-So Familiar)
NJ Budget Mixes Some of the Familiar (and Not-So Familiar)

This episode of The Bottom Line takes a look at newly elected Governor Phil Murphy’s inaugural NJ budget. We’ll highlight some the proposed revenue raisers along with what’s on the governor’s shopping list and how these could impact state residents.

Tim's Top Individual Tax Questions
Tim's Top Individual Tax Questions

In this episode of The Bottom Line, Tim Schuster, discusses some of the individual taxation questions bubbling up from clients in the wake of tax reform including itemized, state and local, mortgage interest and qualified business income.

Top 7 Questions on Tax Reform
Top 7 Questions on Tax Reform

In this episode of “The Bottom Line,” EisnerAmper manager Tim Schuster talks about the seven questions he’s receiving the most from clients on tax reform including converting to a C corporation, the new meals and entertainment rules and beyond.

Retirement Savings Plans for Small Businesses
Retirement Savings Plans for Small Businesses

In this episode of “The Bottom Line,” Tim Schuster talks about the benefits of a retirement savings plan for companies.

What Is the State of Your College Savings Plan?
What Is the State of Your College Savings Plan?

Tim Schuster discusses how starting a college savings account – sooner rather than later – can help alleviate sticker shock for your child’s college education.

Which Health Spending Account Is Right for Your Business?
Which Health Spending Account Is Right for Your Business?

Tim Schuster examines the differences between health savings accounts, health reimbursement accounts and flexible savings accounts, as well as who funds the plan, who owns it, taxation, contribution limits and what happens to unused funds.

SBA Loans for Improving or Expanding Your Business
SBA Loans for Improving or Expanding Your Business

EisnerAmper manager Tim Schuster looks at several categories of Small Business Administration (SBA) loans. He covers what lenders examine in the approval process as well as how business advisors can help you make the most of the process.

How to Succeed at Succession Planning
How to Succeed at Succession Planning

In this episode of “The Bottom Line,” EisnerAmper’s private business services manager Tim Schuster tackles the issue of succession planning. Tim covers his prescription for a healthy business transition and challenges and underlying financial issues.

Plan Today for Tomorrow’s Disaster
Plan Today for Tomorrow’s Disaster

Tim Schuster, EisnerAmper private business services manager, discusses the need for proactive disaster planning. Tim gives a few areas that businesses can focus on to protect themselves, keep their operations running and maintain financial stability.

Welcome to "The Bottom Line"
Welcome to "The Bottom Line"

Tim discusses the different frameworks, including a company’s size and business structure, and where a business advisor can add value. For example, if you’re a mid-sized company, your accountant, banker and lawyer will all probably approach business strategy differently than if you’re a small company.