It’s official – Congress passed the second COVID relief / stimulus bill worth just over $900 Billion. While our previous video touched on several highlights of the bill, there are some important updates to the Employee Retention Credit that could benefit your business.
Reduction in Revenue
- Previously, suspended operations or at least a 50% decline in revenue triggered eligibility
- Now, a revenue reduction of 20% or more qualifies as an eligible quarter
Credit %
- Previously, credit of up to 50% of wages paid during period
- Now, you can receive a credit of up to 70% of wages paid
Credit per Employee
- Previously, credit was capped at $10K in wages per employee
- Now cap is $10K per employee per quarter
PPP Loan
- Previously, you COULD NOT take the employee retention credit if you received a PPP loan
- Now, you CAN take the employee retention credit AND receive a PPP loan (with forgiveness). You simply need to make sure you’re not “double dipping” by taking the ER credit for the same wages/same period you are using your (forgiven) PPP loan funds on.
Remember
- You have the option of amending your payroll tax returns if you’ve already filed them and these changes would affect them. Talk to your payroll provider.
- As mentioned, make sure you’re not using PPP loan funds for the same exact wages you’re using the ER credit on. Either use them for different periods, or do the math on which would be the most beneficial for your business.
Check out our COVID-19 resource page for more blog posts, videos and helpful information for businesses during the Coronavirus pandemic.
