On Monday, November 30, California’s Governor Gavin Newsom announced some things that could help small businesses in California. Most of the programs had already been announced, but it was a good summary of options available for businesses. I have included a partial summary below, but for a full run-down, check out this link.
Main Street Hiring Tax Credit
Qualifying businesses (explained later) can receive a tax credit of $1,000 for each additional employee added after July 1st, 2020. Qualifying businesses:
- Had fewer than 100 employees as of December 31, 2019 and
- Suffered a 50 percent decrease or more in revenue in the second quarter of 2020 compared to the second quarter of 2019.
The calculations of full-time equivalent employees can be confusing, but the state offers some example calculations on the application website.
The state has allocated $100 million for this credit, and it’s available on a first-come, first-served basis. The application opened on December 1st. If you think you might qualify, don’t delay! Here’s the link to apply.
Sales Tax Deferrals
Similar to the options that were available for the second quarter filing, the Governor has asked the CDTFA to provide an automatic three-month extension for sales tax filings. They will also continue to offer interest-free payment arrangements.
COVID Relief Grants
The state has set aside $500 million for grants to be administered by the California Office of the Small Business Advocate. The money will be awarded to intermediaries who will distribute grants of up to $25,000 to small businesses. The hope is that this will start happening in early 2021 – but if you want the latest on the availability of funds, you can go to this link to add yourself to the distribution list for updates.