NC Governor Signs Additional COVID Relief & Guidance Package

May 4, 2020

NC Bill Provides Additional COVID-19 Relief and Guidance _ JPS CPA

This morning NC Governor Cooper signed into law the COVID-19 crisis funding bill unanimously passed by the North Carolina General Assembly on Saturday, May 2, 2020. The roughly $1.5 billion package addresses a variety of provisions, including economic support, education, health care, and provisions for the continuity of state government and regulatory relief.

Accrual of interest on tax obligations suspended
The bill waives the accrual of interest on income and franchise tax liabilities owed between April 15 and July 15. This includes the interest on underpayment of estimated income taxes for the 1st and 2nd quarter of 2020, which effectively means that they can be paid by July 15. The Department of Revenue previously postponed the filing and payment deadlines from April 15 to July 15. In conjunction with that, the Department also waived the assessment of penalties between April 15 and July 15, but the waiver of interest required legislative action.

Funds of Buncombe County TDA Available for Small Business Grants
The legislation allows the Buncombe County Tourism Development Authority (TDA) to provide up to $5 million to be directed towards grants to assist small businesses located in Buncombe County that have closed or been otherwise significantly affected due to the COVID-19 pandemic. The grants will be provided to cover the costs of recommencing business activities.

Specifically, the grants are available to Buncombe County businesses that:

  • Existed prior to January 1, 2020, and “promote tourism and patronage lodging facilities in the county, including, at a minimum, restaurants, retail establishments, studios and galleries, visitor attractions, tours and activities, breweries, wineries, cideries, distilleries, entertainment and event venues, and other providers of food, drink, or entertainment to patrons.” Companies that provide lodging are not eligible for the grant.
  • Employed at least two but nor more than 200 full-time equivalent employees on March 10, which is when North Carolina’s state of emergency was declared.
  • Ceased and have not restarted operations due to economic loss stemming from the virus or can otherwise demonstrate significant economic loss and change in operations.
  • Provide detailed business plans for recommencing operations or resuming normal operations following the state of emergency, showing that the ongoing business concern is sustainable for at least one year.
  • Conduct activities that will significantly increase the patronage of lodging facilities in Buncombe County.

Grants can be for up to $50,000, and independently owned businesses will receive priority. The funding will come from unspent funds currently remaining in the Tourism Product Development Fund, which comes from a portion of the occupancy tax paid by people who visit and stay overnight in commercial lodging facilities in Asheville and Buncombe County.

Other Provisions
The bill makes changes to unemployment laws and provides flexibility in the administration provided by the Department of Employment Security. Also, employers that made 2020 contributions to the state’s Unemployment Insurance Fund on or before April 30, 2020, are eligible for a tax credit for those amounts, which can be claimed on their unemployment tax report due on or before July 31, 2020.

Lastly, in order to ease the financial burden on students and their families, the bill requires that an institution of The University of North Carolina not accrue or charge any interest to past-due student accounts between March 13, 2020, and September 15, 2020.

To read other JPS COVID-related articles, click here.

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