Individuals suffering financially during the current COVID-19 pandemic can avoid tax penalties by accessing their retirement savings. Typically, taxpayers who withdraw funds from a standard retirement account before age 59½ are subject to a 10% additional tax for early withdrawal, barring other qualifying circumstances. To financially survive the pandemic’s impact, the Coronavirus Aid, Relief, and Economic Security (CARES) Act permits taxpayers to make early withdrawals in 2020, which will not be subject to the 10% additional tax under Sec. 72(t) or the 25% additional tax on SIMPLE IRAs under Sec. 72(t)(6) if certain conditions are satisfied.
COVID-19’s Impact on Contractual Relationships and Obligations
In follow up to a previous discussion on force majeure provisions, we reviewed how Coronavirus will affect contractual relationships and obligations. The unique nature of the COVID-19 pandemic has thrust all of America into uncertainty. Relying on Act of God language to exempt you from your legal responsibilities might not be a sure bet, even if you believe you have a convincing case. Taking steps to connect with contract partners might be a better way to reach a resolution that recognizes the harm that was done and modifies certain rights and obligations. By working with a skilled business lawyer, you might be able to avoid a significant conflict over how force majeure is defined in your situation. If a compromise cannot be reached, your attorney can assist you in ascertaining whether you might succeed in a legal action.
The pandemic has underscored the necessity of having a plan in place in the event of untimely death, in an effort to minimize taxes and maximize the value of one’s estate. While the coronavirus’ impact is far reaching and ongoing, individuals should consider revising their estate tax planning based on the following:
Governor Cuomo Announces New Guidelines Allowing Out-of-State Travelers to “Test Out” of Mandatory 14-Day Quarantine. Travelers to NYS must show proof of a negative test taken within three (3) days of arriving in New York State, and must also quarantine for three (3) more days and get another COVID-19 test on the fourth day.
Pursuant to the New York Forward Guidelines relating to sports and recreation, effective July 6, 2020, as determined by the New York State Empire State Development Corporation (the “ESDC”), higher-risk non-professional and non-collegiate sports and recreation activities are the most unlikely to maintain physical distance during the coronavirus era.
On October 8, 2020, the Small Business Association (“SBA”) and United States Treasury Department took a smaller step toward simplification of the application process for Paycheck Protection Program (“PPP”) borrowers, and their lenders, on loans of $50,000 or less.
Effective September 30, 2020, New York’s Paid Sick Leave includes mandatory sick leave for employees throughout New York State, except for employees of government entities. Please be advised that all private sector workers are now covered under New York’s new sick and safe leave law, including part-time employees.
Pursuant to Governor Andrew Cuomo’s guidance, issued in partnership with the New York State Department of Health, Halloween celebrations must be conducted safely, in accordance with specific sanitary and social distancing guidance.
While the world focused on the panic and uncertainty of the COVID-19 pandemic, New York State quietly ushered in its 2020 budget. Hidden in the plans was a brutal change to the Community Medicaid application that is scheduled to take effect on October 1, 2020. There will now be a 30-month (2 ½ year) look-back period for applicants seeking Community Medicaid benefits.