With the new legislation from the Consolidated Appropriations Act, there could be an opportunity from some business to to receive additional relief through the Employee Retention Credit.
Notable changes specific to the Employee Retention Credit include:
- Extension of the Employee Retention Credit through June 30,2021
- Increased credit rate from 50% to 70% of qualified wages
- Increased limit of per-employee qualified wages from $10,000 for the year to $10,000 for each quarter
- Reduced year-over-year gross receipts decline from 50% to 20%
- Creation of a safe harbor to allow employers to use prior quarter gross receipts to determine eligibility
Previously, businesses who received a Paycheck Protection Program loan during the first round of relief couldn’t take advantage of the Employee Retention Credit. However, with the new legislation, a qualifying business can can take the Employee Retention Credit as long as the payroll identified for the Employee Retention Credit was not paid out of Paycheck Protection Program funds.
For more information on this topic as it pertains to your situation, please contact our office at (352) 732-4260.