As businesses move beyond operating in pandemic crisis mode, many are facing a significant financial aftermath and considering their options. If you haven’t yet taken advantage of all available programs to help your company, it’s not too late for some assistance.
You’ve likely spent a lot of time working with your advisor to plan your estate. While documents such as your will, various trusts and a power of attorney are essential, consider adding a “road map” to your plan.
The “sandwich generation” is a large segment of the population. These are people who find themselves caring for both their children and their parents at the same time. As a result, estate planning — which traditionally focuses on providing for one’s children — has expanded in many cases to include one’s aging parents as well.
In addition to causing untold health and economic damages, the COVID-19 pandemic has had a profound—and possibly permanent—impact on many longstanding workplace practices. For example, although working from home began as a temporary emergency response, a number of high-profile companies now say they plan to continue the practice in their post-pandemic operations.
President Biden recently announced his $1.8 trillion American Families Plan (AFP), the third step in his Build Back Better policy initiative. The announcement followed the previous releases of the proposed $2.3 trillion American Jobs Plan and the Made in America Tax Plan. These plans propose major investments in various domestic initiatives, such as expanded tax credits for families, offset with tax increases on high-income individual taxpayers and corporations.
Here’s a summary of some of the proposals:
The recently passed American Rescue Plan Act (ARPA) includes 600 pages of new legislation- a $1.9 trillion COVID relief package. The Act contains retroactive and prospective tax breaks including exclusions from income, new tax-free grant programs, and credits.
On March 17, 2021 the IRS announced an extension of the tax deadline for Individual Income Tax Returns (Form 1040) to May 17, 2021 from April 15. This extension applies to both the filing of the Form 1040 or the filing of an extension form. This also extends the due date for tax payments for individuals only for payments related to 2020 to May 17. This change does not apply to states, though it is likely some/all states will extend the deadline as well.
Long Term Care through a Mandatory Payroll Tax
The Concern: As baby boomers are rapidly moving into retirement, long-term care services provided by Medicare are putting an increasing strain on budgets. 7 out of 10 people will need long-term care after turning 65, and 70% of Americans rely on public benefits such as Medicaid to cover long-term care. In fact, Washington’s spending on Medicaid-funded long-term care is projected to double to $4.01 billion per year in 2030.1