PPB May 2021

employees who are not working due to the reasons they are filing for ERC. • Modifies the definition of qualified wages for employers with 500 or fewer employees to include all wages paid during a period of full or partial suspension of operations due to certain COVID-19-related governmental orders or the calendar quarter for which the gross receipts test was met. • Extends eligibility to: º Employers who started businesses after February 15, 2020 and have average annual gross receipts of less than $1 million looking back over the past three years. The maximum credit a startup business can claim is $50,000 per calendar quarter. º “Severely financially distressed employers,” including employers who have experienced a decline of more than 90 percent in quarterly receipts, measured in a year-over- year basis from 2019 to 2021. These employers, small and large, can treat any wages paid as qualified wages whether or not its employees are actually working. • Expands the statute of limitations from three to five years, allowing the IRS more time to audit these claimed credits. • Provides that employers who received a PPP loan can still claim an ERC tax credit as long as the wages paid with the PPP loan are not those covered by the ERC. • Clarifies that wages taken into account and associated with a second PPP loan, grant for shuttered venue operators or restaurant revitalization grant are not eligible for the ERC. Provisions Most Relevant To Employees The Act provides the following payments and benefits to individuals: • Stimulus payments of $1,400 per individual and eligible dependent for tax filers with an income of $75,000 ($150,000 for joint filers) to phase out for individuals with an income up to $80,000 ($160,000 for joint filers). • Dependent payments will include all eligible dependents including students under 24 and adult dependents, unlike the previous limitation that a dependent has to be age 17 or younger. • Unemployment: º Provides an additional federal $300 unemployment payment per week on top of state benefits through September 6, 2021. º Makes initial $10,200 of unemployment benefits nontaxable for households with income levels up to $150,000. • Tax credits: Expands and modifies certain tax credits such as Child Tax Credit, Earned Income Tax Credit and Dependent Care Credit for eligible filers. • Provides assistance for premium payments for certain health insurance coverage, including COBRA, for those who lose employer-sponsored health coverage. • Provides funding for food and nutritional programs such as SNAP. • Provides funding for childcare and programs for older Americans and their families. • Provides funding for mental health and substance-use disorder services due to increase in need during pandemic. • Extends emergency rental assistance, homeowner assistance and other housing programs. Note: This briefing was prepared from the perspective of HR professionals. The author is not an attorney or accountant. Accordingly, she strongly encourages readers to consult their legal or financial advisors before making business decisions based on this analysis. Claudia St. John, SPHR, SHRM-SCP is president of Affinity HR Group, PPAI’s affiliated human resources partner, which specializes in providing human resources assistance to associations, including PPAI and its member companies. www.affinityHRgroup.com . Affinity HR Group will continue to monitor significant laws and initiatives related to the coronavirus pandemic and their impact on businesses like yours. For coronavirus-related workplace questions, contact Affinity HR at 877-660-6400 or at contact@AffinityHRGroup. com. The company continues to offer its COVID-Support Hour and check out its blog for more COVID-related support www.AffinityHRGroup.com/BLOG. | MAY 2021 | 83 THINK