With the recent signing of the $900 billion Stimulus package on 12/27/2020, there have been updates to the COVID-19 relief legislation that has extended the FFCRA until March 31, 2021 (Q1 2021), and the Employee Retention Credit until June 30th, 2020 (Q2 2021). We gathered some payroll and tax items to consider and here's what we think you should know:
Paid sick and family leave (CRA Sick Leave, CRA Child Leave, CRA Dep Care)
- The extension is until the end of 1st quarter 2021
- The total limit usage from 2020 carries over to 2021 in determining how much available leave is left per employee
- The extension is until the end of 1st quarter 2021
The Employee Retention Credit
- The extension is until the end of 1st quarter 2021
- 70% of the qualifying wages can now be used against federal and increased from the 50%
- The limit is now $10,000 each quarter from the previous annual of $10,000
- The gross receipt requirements to participate in this program changed to 20% from 50%
Deferred Employee Social Security Taxes
- There is no continuation of this program after 2020. The repayment is due by the end of 2021. It is the employer responsibility to collect these taxes during the payroll
Tax Credit Extensions
- The following has been extended through 2025:
- Empowerment Zone Employment Credit
- Employer Credit for Paid Family and Medical Leave
- Work Opportunity Tax Credit
The Paycheck Protection Program
- An additional $284 billion has been added to the program
- The program now includes all non-profits
- Employers with a PPP loan may obtain a second one
- Loan applications must be filed by 1st quarter 2021
