Stay in touch with your tax and financial advisers
In response to the COVID-19 pandemic, the federal government and many state governments are taking steps to provide companies with much-needed financial assistance through tax relief and loans. For example, as we previously reported, the IRS may provide tax credits to covered employers (those with 500 or fewer employees) granting their workers qualifying leave under the Families First Coronavirus Response Act (FFCRA). Generally, employers offset the money paid for FFCRA leave by holding onto money they would otherwise withhold and deposit quarterly for FICA taxes. Similarly, under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, on which we also previously reported, eligible employers experiencing a full or partial suspension due to COVID-19-related shutdown orders may be able to claim an Employee Retention Credit for continuing to pay their workers qualifying wages or other expenses. The U.S. Treasury Department is also providing Paycheck Protection Loans to qualifying employers through preferred lenders, and other loans may be available to certain business through the Small Business Administration. Although sources indicate some of these resources are tapped out, it’s possible (and, based on news reports, likely) the U.S. Congress will inject them with more funding. Some state governments, and even local governments, are following suit by offering direct financial assistance to companies through loans, or by offering tax credits or deadline extensions.
Tips For Employers: The list above isn’t exhaustive, which is why it’s important to stay in close contact with your tax and financial advisers. They’re your best resources to discuss whether you qualify for any loans or credits, and if you do, to help you with compliance issues to make sure you get them. Vigilant continues to report on some of the headline-making financial assistance available to employers, but your financial and tax advisers will know the ins and outs of whether you qualify for such relief, and how best to get it. As Vigilant Law Group employment attorneys continue to help you navigate the murky waters of employment law, we encourage you to stay in touch with your financial and tax advisers to help you stay afloat.
This website presents general information in nontechnical language. This information is not legal advice. Before applying this information to a specific management decision, consult legal counsel.