Vol. XIX, Issue 39
The federal government continues to issue guidance to clarify and fine-tune features of the massive Coronavirus Aid, Relief and Economic Security Act (CARES Act) passed in late March.
On June 19, 2020, the Internal Revenue Service (IRS) released Notice 2020-50, which provides additional guidance related to CARES Act provisions for retirement plans and participants. The new guidance makes these clarifications:
Wespath has updated these documents to reflect the changes.
On June 23, 2020, the Small Business Administration (SBA) published additional regulatory guidance about the Paycheck Protection Program (PPP). The SBA issued a new interim final rule regarding PPP loan forgiveness and SBA loan review. The guidance reiterates much of what was published last week, and which we described in brief in the June 23, 2020 On Board Express. However, one new wrinkle was added regarding forgiveness with this new rule. Under the rule, PPP borrowers can apply for loan forgiveness before the end of their 24-week covered period, once the loan proceeds are completely spent.
However, the explanation of this option seems to leave open questions about situations wherein the borrower has furloughed employees or reduced their wages. This new rule states that if there has been a reduction in wages by the time the loan forgiveness application is made, those reductions must be taken into account for the entire covered period. It is unclear how the borrower will know what is going to happen for the remainder of the covered period. Further, it is unclear what happens if the borrower furloughs employees or reduces wages after the loan forgiveness application is made. Additional guidance from the SBA may be needed to clarify these uncertainties.
This week's participant e-blast communication was sent yesterday, June 24. It details Wespath’s efforts to address systemic racial injustice by highlighting a statement signed by General Secretary Barbara Boigegrain, as well as other general secretaries and church leaders, and the Investor Statement of Solidarity to Address Systemic Racism and Call to Action to which Wespath is a signatory. This issue also includes a video outlining plans by Wespath’s Benefits Education team to provide virtual educational opportunities and, for HealthFlex participants, provides information about ongoing coverage of telemedicine and testing and treatment for COVID-19. Click here to view the version sent to HealthFlex participants; click here to view the non-HealthFlex email.