CARES ACT: Additional Provisions That Might Affect You
The CARES ACT was a $2+ Trillion unprecedented Act of Congress designed to provide relief to Americans who have been negatively affected by COVID-19 and subsequent "Stay at Home" orders. Up until now, most of our attention has been devoted to the SBA Payroll Protection Program loans because it had such a short window of time to respond.
However, the law includes some other elements that could be beneficial for you.
Employer Tax Deferment
Effective beginning the 2nd Quarter 2020, almost all employers may defer the employee portion of Social Security (6.2%). The deferral is available through the end of 2020. Deferrals call for 50% payable by 12/31/2021 and the balance by 12/31/2022. It’s basically an interest-free loan. Employers who received funding from the Paycheck Protection Program may participate up until the point they receive notice of partial or full forgiveness of their loan. Any deferments made up until that time will remain deferred.
If you are a Payroll client of BFG, a simple email saying that you would like to begin this deferral effective as of a designated date is all we need to implement this on your behalf.
Employee Retention Credits
Any eligible employers who meet the following may receive a refundable tax credit for payments to employees up to 50% of their wages up to $10,000 until January 1, 2021. Employers who received funding from the Program Protection Program are not eligible:
Fully or partially suspends operation during any calendar quarter in 2020 due to orders from an appropriate governmental authority limiting commerce, travel, or group meetings (for commercial, social, religious, or other purposes) due to COVID-19; or
Experiences a significant decline in gross receipts during the calendar quarter.