If you did not accept funds under a Paycheck Protection Program loan, you may want to consider tax credits that are available to you. The Employee Retention Credit under the CARES Act encourages businesses to keep employees on their payroll.
CARES Employee Retention Payroll Tax Credit
- Employer is not eligible for the tax credit if it receives an SBA loan under the Paycheck Protection Program.
- An eligible employer is one that has had
- Operations fully or partially suspended due to COVID-19 related government order that limits commerce, travel or group meetings; or
- Gross receipts for the 2020 quarter decline more than 50% when compared to the same 2019 quarter (eligibility continues through the 2020 quarter in which gross receipts are greater than 80% of gross receipts in the same 2019 quarter)
- For employers with greater than 100 employees, tax credit is 50% of wages up to $10,000 paid to employees who are NOT performing service (max credit of $5,000 per employee)
- For employers with 100 or fewer employees, tax credit is 50% of wages up to $10,000 paid to any and all employees (max credit of $5,000 per employee)
- Employer is determined on a controlled group/affiliated service group basis