The IRS has released guidance on certain business tax provisions of the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act. Released on Friday, April 10, Rev. Proc. 2020-22 informs taxpayers how to make certain elections with respect to the newly relaxed business interest expense limitation and provides real estate and farming businesses with the option to make late elections or withdraw pre-CARES elections. One week later, on Friday, April 17, 2020, the IRS announced in Rev. Proc. 2020-25 that taxpayers may change their depreciation for certain qualified improvement property. It also allows taxpayers to make late, revoke, or withdraw certain depreciation elections. While both revenue procedures are separately significant, their interplay, and the interplay of the associated CARES provisions, may be especially important for certain electing real property and farming businesses.
Among the many federal agency actions taken in response to the health and economic consequences of the COVID-19 outbreak is an interesting and much unpublicized one related to the Stark Law, a healthcare fraud and abuse law that prohibits physicians from referring patients for certain designated health services paid for by Medicare to any entity in which they have a “financial relationship.”
On March 30, 2020, the Centers for Medicare and Medicaid Services (“CMS”) unexpectedly announced temporary nationwide Section 1135 blanket waivers (retroactive to March 1, 2020) for certain Stark Law penalties of the Social Security Act. By relaxing some restrictions on payments and referrals, hospitals and healthcare providers should find it easier to collaborate during this time when the healthcare system is confronting an unprecedented pandemic.
The blanket waivers are narrowly tailored and require entities to act in good faith to provide care in response to the United States national emergency declared due to the COVID-19 outbreak. The blanket waivers do not excuse any otherwise illegal fraud or abuse and those using the blanket waivers must be satisfying one of the six explicitly defined COVID-19 purposes. A further requirement is that the otherwise illegal relationship must fall into the one of the eighteen permitted relationships. Because of these complex requirements the potential use of any waiver will require fact-intensive analysis of each relationships’ circumstances and conditions. Continue reading
Healthcare providers should note that HHS has deposited funds in many of your bank accounts. The funds are from two programs, the CMS Accelerated and Advance Program and the CARES Act Provider Relief Fund. The CMS Accelerated and Advance Program is a loan against future payments from government healthcare programs and must be repaid (likely from reductions in future payments). The CARES Act Provider Relief Fund is a grant program, but in order to retain the money you have received providers must sign and deliver an attestation within 30 days following receipt of the funds. The clock has already started to run. There has been much confusion about the CARES Act payment because the certification required that the provider be involved in the treatment or diagnosis of potential COVID-19 patients. CMS has clarified, however, that any patient is a potential COVID-19 patient. The newly published HHS Cares Act data page where you can access the required attestation and instructions and learn more about this important update.
The CARES Act provides enhanced financial support for businesses and other eligible entities suffering from the continuing COVID-19 pandemic. While much of the CARES Act provides relief to for-profit businesses (see our previous post), there are specific provisions for nonprofits and tax-exempt organizations (collectively “TEOs”) which help support the operations and fundraising needs of TEOs during the COVID-19 pandemic and recovery.
Operations support for TEOs
Small Business Loan Program. The CARES Act created a new business loan program known as the “Paycheck Protection Program.” In addition to certain other businesses, the Paycheck Protection Program is available to TEOs described in either 501(c)(3) (public charities) or 501(c)(19) (veterans organizations). TEOs falling within these categories are eligible for loans under the Paycheck Protection Program, subject to other eligibility criteria, while TEOs not falling within these categories are excluded from the benefits of the Paycheck Protection Program. TEOs interested in the Paycheck Protection Program should see our previous posts on this subject.
Economic Injury Disaster Loans. The CARES Act specifically includes the COVID-19 pandemic as a disaster for which most TEOs could obtain disaster assistance loans under the SBA’s 7(b)(2) program. Qualifying small TEOs may receive a $10,000 advance if the TEO’s number of employees or annual receipts qualify. The advance under this program is not required to be repaid.
Emergency Relief and Taxpayer Protections. The CARES Act allocates $500 billion for loans, loan guarantees, and other investments to eligible businesses including TEOs with between 500 and 10,000 employees. The emergency relief loans are subject to a favorable interest rate (no higher than 2% per annum) and no principal or interest is due during the first six months.
Employee Retention Credit and Delay of Payroll Taxes. TEOs are eligible for the dollar-for-dollar employee retention credit against payroll tax liability. The amount of the credit is equal to 50% of the first $10,000 in wages per employee. TEOs who qualify may delay the employer’s share of payroll taxes through the end of 2020. The delayed payroll taxes are repaid in two installments, with the first due by December 31, 2021 and the second due by December 31, 2022.
Fundraising support for TEOs
In addition, as we previously discussed, the CARES Act allows a partial above the line deduction of up to $300 of cash contributions to charitable organizations and churches, whether the taxpayer itemizes deductions or not, suspends the 50% of adjusted gross income limitation for charitable deductions by individuals, and increases the 10% limitation for corporations to 25% of taxable income and increases the limitation on deductions for contributions of food inventory from 15 % to 25%.
Attorney Susan B. Hecker contributed to this post.
On Friday, April 10, 2020, the IRS launched a new frequently asked questions (FAQ) page on the deferral of employment tax deposits and payments. The Coronavirus Aid, Relief, and Economic Security (“CARES”) Act allows employers to defer the deposit and payment of the employer’s share of social security taxes and self-employed individuals to defer payment of certain self-employment taxes between March 27, 2020 and January 1, 2021. As discussed in our previous blog post, payment of half of these deferred amounts would not become due until December 31, 2021. The second half would be due a year later on December 31, 2022.
Such deferral is, however, prohibited for an employer who receives loan forgiveness under the CARES Paycheck Protection Program (“PPP”). Because the language of the CARES Act makes clear that employment-tax deferral is not disallowed until PPP loan forgiveness actually occurs, it appeared that employers could currently take advantage of such deferral while in the midst of the loan application and forgiveness processes. What remained more uncertain was how the IRS planned to treat previously deferred employment-tax payments once an employer did receive a decision that its lender would forgive the loan.
Question 4 of the FAQ clarifies this interplay between the employment-tax deferral and PPP loan forgiveness as follows:
- Employers who have received a PPP loan, but whose loan has not yet been forgiven, may defer deposit and payment of the employer’s share of social security tax that otherwise would be required to be made beginning on March 27, 2020, through the date the lender issues a decision to forgive the loan.
- Employers who do so will not incur failure-to-deposit and failure-to-pay penalties.
- Once an employer receives a decision from its lender that its PPP loan is forgiven, the employer is no longer eligible to defer deposit and payment of the employer’s share of social security tax due after that date.
- The amount of the deposit and payment of the employer’s share of social security tax that was deferred through the date that the PPP loan is forgiven continues to be deferred and will be due on the “applicable dates” (50% on December 31, 2021 and the remaining amount on December 31, 2022).
The IRS has ensured that information will be provided in the near future to instruct employers how to reflect the deferred deposits and payments otherwise due on or after March 27, 2020 for the first quarter of 2020 (January through March 2020). Employers will not be required to make a special election to be able to defer deposits and payments of these employment taxes.
The FAQ also makes clear that the ability to defer deposit and payment of the employer’s share of social security tax is in addition to the relief provided in Notice 2020-22, which provides relief from the failure-to-deposit penalty for not making deposits of employment taxes (including taxes withheld from employees) in anticipation of the Families First Coronavirus Relief Act (FFCRA) paid leave credits and the CARES Act Employee Retention Tax Credit (ERTC). An employer is therefore entitled to defer deposit and payment of its share of social security tax prior to:
- determining whether it is entitled to the paid leave credits under the FFCRA or the ERTC;
- determining the amount of employment tax deposits that it may retain in anticipation of these credits (FFCRA and ERTC), the amount of any advance payments of these credits, or the amount of any refunds with respect to these credits; and
- receiving a determination of PPP loan forgiveness from its lender.
Keep in mind that an employer who has received a loan under the PPP is not eligible for the ERTC. The FAQ, however, essentially provides that employers can defer deposit and payment of their share of social security tax while in limbo with any of these relief provisions. Additionally, while deferral in anticipation of the ERTC may not be warranted (i.e., because an employer has already received a PPP loan), general deferral would still be permissible until that employer receives official notice of loan forgiveness.
Larger employers who are ineligible for the PPP loans, or employers who choose not to apply for these loans, will be able to utilize both the ERTC (if eligible based on economic decline) and employment-tax deferral. The ERTC and other credits that reduce payroll taxes will reduce the amount eligible for deferral.
On Thursday, April 9, 2020, the Internal Revenue Service (“IRS”) released two notices and one revenue procedure offering additional filing and payment relief for taxpayers and providing procedural guidance on a main business tax provision of the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act.
Extension of Deadlines for Generally All Federal Tax Filings
Notice 2020-23 which “amplifies” Notice 2020-18 and Notice 2020-20 (discussed in a previous blog post) to include any person with a specified Federal tax payment obligation or Federal tax return or other form filing obligation due on or after April 1, 2020 and before July 15, 2020 in the definition of Affected Taxpayer. This includes individuals, trusts, estates, corporations, and other non-corporate tax filers, including Americans who live and work abroad. The deadline is automatically postponed to July 15, 2020.
Among other payment and filing obligations, the following are specifically included in Notice 2020-23:
- U.S. Estate (and Generation-Skipping Transfer) Tax Returns (Form 706)
- U.S. Income Tax Returns for Estates and Trusts (Form 1041)
- Information Regarding Beneficiaries Acquiring Property from a Decedent (Form 8971)
- U.S. Nonresident Alien Income Tax Returns (Form 1040-NR)
- U.S. Corporation Income Tax Returns (Form 1120)
- U.S. Income Tax Returns for S Corporations (Form 1120-S)
- U.S. Returns of Partnership Income (Form 1065)
- Exempt Organization Business Income Tax Returns (Form 990-T)
- Estimated Tax for Individuals (Form 1040-ES)
- Estimated Income Tax for Estates and Trusts (Form 1041-ES)
The three-month relief provided under Notice 2020-23 to an Affected Taxpayer is automatic, and therefore, there is no requirement to file an Application for Automatic Extension to obtain the benefit of the filing and payment postponement deadline of July 15, 2020. However, the Affected Taxpayer must file the appropriate form for an extension of time by July 15, 2020 to obtain an extension to file until October 15, 2020. Nevertheless, any tax payments will still be due on July 15, 2020.
Accordingly, the period beginning on April 15, 2020 and ending on July 15, 2020 will be disregarded in the calculation of any interest, penalty, or addition to tax for failure to file or to pay. Interest, penalties, and additions to tax with respect to such postponed Federal tax filings and payments will begin to accrue on July 16, 2020.
CARES NOL Guidance
Just one day after the issuance of Revenue Procedure 2020-23, allowing eligible partnerships to file amended partnership returns, as discussed previously, the IRS followed up with procedural guidance with regard to making certain NOL elections under the CARES Act. The IRS also extended the deadline for taxpayers seeking “quick refunds” for 2018 net operating losses (NOLs).
Revenue Procedure 2020-24 provides guidance to taxpayers with net operating losses that are carried back under the CARES Act. The specific guidance includes procedures for:
- waiving the carryback period in the case of an NOL arising in taxable years beginning in 2018, 2019, and 2020;
- disregarding certain amounts of foreign income subject to transition tax that would normally have been included as income during the five-year carryback period; and
- waiving a carryback period, reducing a carryback period, or revoking an election to waive a carryback period for a taxable year that began before Jan. 1, 2018, and ended after Dec. 31, 2017.
As stated in our previous post, taxpayers must elect out of the CARES Act NOL carryback. An election to waive the carryback for NOLs arising in tax years beginning in 2018 or 2019 must be made no later than the due date, including extensions, for filing the taxpayer’s federal income tax return for the first tax year ending after March 27, 2020. A taxpayer makes the election by attaching to its federal income tax return filed for the first tax year ending after March 27, 2020, a separate statement for each of the tax years 2018 or 2019 for which the taxpayer intends to make the election. The election statement must state that the taxpayer is electing to apply Internal Revenue Code section 172(b)(3) under Rev. Proc. 2020-24 and the tax year for which the statement applies.
Notice 2020-26 grants a six-month extension of time to file Form 1045, Application for Tentative Refund, or Form 1139, Corporation Application for Tentative Refund, as applicable, with respect to the carryback of a net operating loss that arose in any taxable year that began during calendar year 2018 and that ended on or before June 30, 2019. To file for these quick refunds, individuals, trusts, and estates would file Form 1045, and corporations would file Form 1139.
Starting on April 17, 2020 and until further notice, the IRS will accept eligible refund claims on Form 1139 submitted via Fax to 844-249-6236 and eligible refund claims on Form 1045 submitted via fax to 844-249-6237. These fax numbers will not be operational prior to April 17. The IRS is encouraging taxpayers to wait until this procedure is available rather than mailing their Forms 1139 and 1045, as mail processing is being impacted by the COVID-19 emergency. This same procedure may be used by a corporate taxpayer claiming a refund for the acceleration of the recovery of remaining minimum tax credits for its 2018 or 2019 taxable years.
The IRS has released an FAQ to answer common questions associated with this new procedure.
On April 8, the IRS released guidance through Revenue Procedure 2020-23 that will allow partnerships to take advantage of certain tax benefits granted by the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act. The CARES Act grants certain businesses tax relief in the way of bonus depreciation deductions and an increased business interest deduction limit. This tax relief has been applied retroactively to affect 2018 and 2019 tax years. Partnerships will be allowed to file amended returns for the 2018 and 2019 tax years without first making a request for IRS approval for such changes.
Under the Bipartisan Budget Act of 2017 (the “BBA”), partnerships which have not elected out of the centralized partnership regime are required to file a tax return for the tax year while also furnishing to its partners tax information regarding the partnership, including each partner’s Schedule K-1. Under the BBA, a Schedule K-1 could not be amended without prior IRS approval once the partnership’s tax return due date has passed. This created an inconsistency with the CARES Act, causing a partnership to be unable to take advantage of retroactive tax benefits without first jumping over a number of IRS procedural hurdles.
To alleviate the stress the ongoing COVID-19 pandemic has brought to partnerships, Revenue Procedure 2020-23 allows partnerships that have filed a tax return for tax years beginning in 2018 or 2019 to file amended partnership returns and furnish amended Schedule K-1s to partners before September 30, 2020. The amended returns may take into account tax changes brought about by the CARES Act affecting a partnership’s tax attributes.
We invite you to join our partner Jennifer Fowler-Hermes for a virtual presentation hosted by the Lakewood Ranch Business Alliance this Wednesday, April 8.
The program will answer questions around the new aid packages available to businesses as a result of the COVID-19 crisis. With the rollout of these new programs, business owners are scrambling to quickly understand the details surrounding the offered benefits, applications processes, and eligibility requirements. Jennifer will share guidance on how employers should approach the situation from an HR perspective and will be joined by a partner with Kerkering Barberio to provide insight on the tax and accounting implications.
Participants may join by video or phone. For more details and to register, visit LWRBA.
As discussed in an earlier post, the CARES Act authorizes the Director of the United States Patent and Trademark Office (“USPTO”) and the Register of Copyrights to “toll, waive, adjust, or modify” certain timing deadlines and provisions under trademark and copyright law in response to the coronavirus outbreak. The USPTO and the Copyright Office have now issued notices exercising these powers.
The notice issued by the USPTO extends by 30 days the deadline for certain trademark filings that were due March 27 through April 30, 2020, including certain of the following:
- Responses to Office Actions, including notices of appeal from a Final Refusal;
- Statements/Affidavits of Use, Requests for Extension of Time to file Statements of Use, and Affidavits of Excusable Nonuse;
- Notices of Opposition and Requests for Extension of Time to File Notices of Opposition;
- Priority Filings based on foreign applications and Requests to Transform an Application based on foreign applications; and
- Renewal Applications.
The filing must be accompanied by a statement that the delay in filing or payment was due to the fact that the practitioner, applicant, registrant, or other person associated with the filing or fee was personally affected by the COVID-19 outbreak, such that the outbreak materially interfered with the timely filing or payment. This could be due to office closures, cash flow interruptions, inaccessibility of files or other materials, travel delays, personal or family illness, or similar circumstances.
The USPTO also reaffirmed its offer to waive fees for petitions to revive and reinstate applications and registrations that are abandoned or canceled or which expire due to the inability to timely respond to a USPTO communication as a result of the COVID-19 outbreak as we described in this prior post.
For all other situations not addressed by the USPTO notice, a request or motion for an extension of time may be made as appropriate.
- Copyright Office
The notices issued by the Copyright Office relating to the COVID-19 outbreak are available here. They provide the following:
- Timing for Registration – Generally, a copyright owner is eligible to be awarded statutory damages in an infringement action only if the work has been registered prior to the infringement or within three months of the work’s publication. To mitigate the effect of any disruption in registration timing due to the coronavirus outbreak, the Copyright Office has provided the following:
- For copyright applications that can be submitted entirely in electronic form, the timing provisions are unchanged.
- If the applicant can submit an application electronically but is unable to submit a required physical deposit, the applicant should upload, together with the application, a declaration or similar statement certifying, under penalty of perjury, that the applicant is unable to submit the physical deposit and would have done so but for the national emergency. The declaration must also include supporting evidence, such as statements that the applicant is subject to a stay-at-home order or that the applicant is unable to access the physical materials due to closure of their business. In this case, if the three-month window for registration after the date of first publication was open as of March 13, 2020, the window will be extended, provided that the applicant submits the required deposit within 30 days after the date the disruption ended as determined by the Register.
- If the applicant is unable to submit an application electronically or physically, the applicant may submit an application after the Register has announced the end of the disruption. The applicant must include a declaration or similar statement certifying, under penalty of perjury, that the applicant was unable to submit the application and would have done so but for the national emergency. The declaration must include supporting evidence, such as statements that the applicant did not have access to a computer or the internet or that the applicant was prevented from accessing or sending the required physical materials for reasons similar to those set out in the preceding bullet. In this case, the three-month window will be tolled between March 13, 2020, and the date that the disruption ended.
- Timing for Termination – Under certain circumstances, the Copyright Act allows authors to reclaim copyright interests that have been transferred to others. In general, an author may terminate a transfer within a five-year window, provided that the author serves a notice on the transferee between two and ten years before the chosen termination date. After service, the notice must be recorded with the Copyright Office. To ensure that authors are not deprived of their ability to effect this termination, the Copyright Office has provided the following:
- If the termination window is expiring, the window for service of a notice of termination will be extended if:
- the termination window expires on or after March 13, 2022, and less than two years after the date the disruption by coronavirus ends;
- the author serves a notice of termination within 30 days after the date the Register announces as the date that the disruption ended; and
- the notice of termination is accompanied by a declaration or similar statement certifying, under penalty of perjury, that, but for the national emergency, the author would have been able to serve the notice at least two years before the close of the window, setting forth an explanatory statement supporting the declaration.
- If the window to record is expiring, the requirement that the notice be recorded before the date of termination will be waived if:
- the author has already served the notice on the transferee;
- the termination date listed on the notice is on or after March 14, 2020, and on or before the date the Register announces as the date the disruption ended;
- the author records the notice within 30 days after the date the disruption ended; and
- the recordation submission includes a declaration or similar statement certifying, under penalty of perjury, that, but for the national emergency, the author would have served the notice in a timely manner. The declaration must also set forth an explanatory statement supporting the certification, such as a statement that the author was prevented from accessing or mailing the required materials.
- If the termination window is expiring, the window for service of a notice of termination will be extended if:
The Copyright Office says it will also consider additional appropriate modifications as it becomes aware of sufficient disruption to the copyright system caused by the outbreak. The above modifications will be in effect for 60 days, unless the Register issues an announcement stating that the period of disruption ended before that time or that a further extension is necessary.
In its notices, the Copyright Office has also set out some alternate procedures for electronic applications accompanied by physical deposits to mitigate the effect of the temporary closure of the Copyright Office.
It would be best if all applicants and registrants could timely file their documents with the USPTO and the Copyright Office if they are able. However, for those who are unable to timely file because of the effects of the Coronavirus outbreak, we recommend you confer with an intellectual property attorney to confirm if and how your deadline may be extended under the guidance issued by the USPTO and the Copyright Office.
Title IV of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), provides mortgage relief to homeowners with federally backed mortgage loans. The CARES Act allows eligible borrowers to request forbearance on loan payments for six months, and then request an additional six month forbearance period. The Act also includes a moratorium on foreclosure actions. The applicable provisions are summarized below.
Loans Secured by Property Designed for 1-4 Families
Eligibility: Federally Backed Mortgage + Financial Hardship
Only borrowers holding a “federally backed mortgage loan” are eligible for forbearance. “Federally backed mortgage loans” are loans secured by a lien on real property designed for 1-4 families and which are insured by the FHA, the Department of Veterans Affairs, or the USDA (or made directly by the USDA), and loans purchased or securitized by Fannie Mae and Freddie Mac. Therefore, not all mortgagors will be benefitted by these provisions. Borrowers should note that forbearance is not forgiveness of the debt. Instead, forbearance provides additional time for repaying the debt. During the forbearance period, no fees, penalties or interest beyond the amounts scheduled or calculated as if the borrower made all contractual payments on time, shall accrue.
According to the National Housing Law Project, approximately 70 percent of single-family mortgages are federally-backed. To determine whether your loan is purchased by Fannie Mae or Freddie Mac, you can search the databases available on their websites. For other information regarding whether your loan is federally backed, you can contact your loan servicer (if you do not know the identity of your loan servicer, you can check the Mortgage Electronic Registration Systems website). Even if your loan is not federally backed, some lenders are offering similar deferral programs for borrowers who are ineligible under the CARES Act.
Additionally, a borrower holding a federally backed mortgage must have experienced “financial hardship” due to COVID-19. To receive forbearance, the borrower must submit a request to the borrower’s servicer attesting financial hardship due to COVID-19. The term, “financial hardship” is not defined in the Act, and loan servicers may not require additional documentation evidencing financial hardship.
The Act does not limit the amount of debt that may be deferred.
Loan forbearance period
Borrowers may request an initial forbearance of up to 180 days and an extension for an additional period of up to 180 days during the “covered period.” The covered period began with the adoption of the CARE Act and will end upon the sooner of: (i) termination of the national COVID-19 emergency, and (ii) December 31, 2020.
Moratorium on Foreclosures
Except with respect to a vacant or abandoned property, a servicer of a federally backed mortgage loan (as defined above) may not initiate any foreclosure process, move for a foreclosure judgment or order of sale, or execute a foreclosure-related eviction or sale before May 17, 2020. (See below for a discussion on the temporary freeze on writs of possession, which are required to remove a foreclosed borrower.)
Loans Secured by Multifamily Property (5+ Families)
Section 4023 of the Act provides for forbearance for borrowers holding “federally backed multifamily mortgage loans,” which include loans secured by real property designed for 5 or more families made or insured by the federal government. This specifically includes loans made in connection with HUD and loans purchased by Fannie Mae and Freddie Mac.
Temporary financing, such as construction loans, are not eligible for forbearance. As such, many developers may not be able to take full advantage of these provisions.
Multifamily borrowers may request forbearance by attesting financial hardship due to COVID-19. However, the borrower must have been current on its payments as of February 1, 2020.
The initial forbearance period is 30 days from the multifamily borrower’s request. The borrower may extend the forbearance for up to 2 additional 30-day periods, provided the request is submitted at least 15 days prior to the initial forbearance period. (We interpret the 15-day deadline as referring to only the first request for an extension, but the statute is unclear.) All initial and extension requests must be made before the sooner of: (i) termination of the national COVID-19 emergency, and (ii) December 31, 2020.
During the period that the multifamily borrower receives forbearance, it may not evict a tenant from a unit in the applicable property solely for failure to pay rent, charge late fees or penalties for failure to pay rent, or require a tenant to vacate a unit. Even if a multifamily borrower does not receive forbearance or has stopped receiving forbearance, it may be prohibited from performing the above actions pursuant to the moratorium on evictions described below.
Moratorium on Evictions
Under Section 4024 of the Act, borrowers holding a federally-backed mortgage or multifamily mortgage, may not, before July 25, 2020, evict a tenant from the applicable property solely for failure to pay rent, charge late fees or penalties for failure to pay rent, and require a tenant to vacate a unit. This moratorium applies to all borrowers holding a federally-backed mortgage, regardless of whether they actually apply for or receive forbearance. Even if borrowers are able to bring an eviction action against a tenant, a recent order from the Supreme Court of Florida has potentially delayed their ability to obtain a writ of possession, the final order in an eviction lawsuit used to remove an evicted tenant.
Given the lack of guidance surrounding the definition “financial hardship” and loan servicers’ inability to refute a borrower’s claim of hardship, the number of borrowers eligible for forbearance under the Act is potentially immense. A borrower who is unable to keep mortgage payments current is encouraged to contact the servicer to request forbearance. A borrower should be prepared to describe the financial hardship to the servicer, and should follow up to obtain written documentation as to the forbearance.
Our team at Williams Parker is ready to assist individuals, developers, and owners of multifamily property who are considering taking advantage of the loan forbearance provision in the CARES Act. We are monitoring governmental publications and will share any further guidance that is provided as to the circumstances that constitute “financial hardship.”
Williams Parker’s COVID-19 response team is continuing to monitor these and other developments, and advise on issues arising from the Coronavirus. View the latest updates.
Partner Terri S. Costa contributed to this post.