COVID-19

Health Savings Accounts (HSAs) allow eligible individuals to make deductible contributions that can be withdrawn tax-free for reimbursement of eligible medical expenses.

For 2021, the limitation on HSA deductions is $3,600 (up from $3,550 for 2020) for an individual with self-only coverage under a High Deductible Health Plan (HDHP) or $7,200 (up from $7,100 for 2020) for family coverage.

An HDHP is defined as a health plan with:

The Social Security Administration (SSA) has updated its website to explain how recipients of Supplemental Security Income (SSI) payments who have a representative payee will receive their economic impact payments (EIPs).

Background

My friend Joe Duffy (Award-Winning author of “Being a Supervisor 1.0: A Handbook for the New, Aspiring, and Experienced Supervisor”) recently sent me an article published by Elizabeth Weingarten for Ideas 42.  When I read it, I was reminded how often I start a conversation these days with the typical question, “How are you?” - to which I receive the usual response -  “I’m fine. How are you?”

Owners of privately held companies are wise to document in an agreement the terms of any potential transfer of ownership, should a triggering event occur.  When a new company is formed, the founders rarely think about what could happen in 5 to 10 to 50 years.  Initially, everyone trusts everyone, and, of course, everyone will live forever.  Why should founders even think about a transfer of ownership?  All current members are in it for the long haul!

The Paycheck Protection Program (“PPP”), established by the CARES Act, is a Small Business Association (“SBA”) loan intended to help businesses with 500 or fewer employees keep their workforce employed during the COVID-19 crisis. Congress initially allocated $349 billion to the program in the first stimulus package, and added an additional $310 billion in April.

When appraising an asset, there are three types of depreciation to be considered, physical depreciation, functional obsolescence, and economic (external) obsolescence.

Physical depreciation is exactly what it sounds like. It is a decrease in property value due to physical wear and tear, deterioration, exposure to various elements, physical stress, the passage of time, and similar factors. Depending on the cost to cure, physical depreciation can be curable or incurable. Normally, physical deterioration is considered first.

With businesses currently struggling, expected revenue and profit levels are declining for many. If you carry goodwill on your balance sheet, this global economic decline may be a triggering event for testing goodwill for impairment, and this may be the time to do so. With high volatility in the stock market and an end date for COVID-19 Stay-at-Home just entering the discussion, experts cannot predict what the long-term economic implications will be on the value of your real estate, business, and other assets. We want our clients to know they have options.

Valuation is a combination of facts, data, and assumptions.   As part of the risk assessment process, the valuation analyst must consider contemporaneous conditions and ask “how is the company affected by this?” The COVID-19 pandemic is a highly unusual challenge to valuation professionals, as we don’t know how businesses and certain industries may react once restrictions are lifted and the economy is allowed to resume operations on a “normal” basis.