Recent legislation provides another round of financial assistance for qualifying businesses. Also read about several suggestions for managing remote workers in your business.

More Financial Assistance Available for Businesses

PPP loan application deadline extended to May 31

Businesses can get another round of financial assistance courtesy of the recently-passed American Rescue Plan Act and an extension of the Paycheck Protection Program (PPP) loan application deadline. Here’s what you need to know.

PPP loan application deadline is May 31. The deadline to apply for PPP loans is extended from March 31 to May 31, 2021.

• To qualify for an initial PPP loan, your business must have been open on or before February 15, 2020 and have 500 or fewer employees or independent contractors for whom the business paid salaries, compensation, and payroll taxes.
• If you received PPP loan proceeds in 2020 and wish to apply for a 2nd PPP loan, your business must have 300 or fewer employees, demonstrate a decrease in gross receipts of at least 25 percent in any quarter of 2020 compared to the same quarter in 2019, and have used or will soon use the entire amount of your first PPP loan.

Next steps: If you think your business qualifies, contact your bank and review the steps necessary to get your new loan in place.

Sick leave extended. If your business provides sick leave for COVID-related reasons, you might get reimbursed for the sick pay through a tax credit.

• To qualify for this credit, your business must have fewer than 500 employees and voluntarily provide sick leave through September 30, 2021.
• There are limits for each employee. However, for employees who took 10 days of sick leave in 2020 using this same provision, they can take another 10 days beginning April 1, 2021.
• This tax credit is now available through September 30, 2021.
• Covered reasons to get the tax credit now include sick leave taken to get COVID testing, obtain a vaccination, or to recover from the vaccination.
• These benefits also cover self-employed workers.

Next steps: If you qualify for this credit, you must document COVID-related sick pay for each employee and record it through your payroll.

Family Medical Leave Act Provisions extended. If you have an employee who is unable to work because of needing to care for someone else related to COVID-19, you might get reimbursed for the paid leave through a tax credit.

• To qualify for this credit, your business must have fewer than 500 employees and voluntarily provide paid family and/or paid medical leave.
• This tax credit is now available through September 30, 2021.
• Qualified wages for this provision increase to $12,000, up from $10,000. The amount of the credit, however, was not increased.
• The Family Medical Leave Act also applies to self-employed workers.

Changes in Employee Retention Credit. Businesses can get up to a $28,000 tax credit per employee in 2021, up from the $5,000 maximum credit in 2020.

• To qualify for this credit, you must have operations that were fully or partially suspended by governmental action due to COVID-19 or have experienced a significant decline in gross receipts.
• The decline in gross receipts is per calendar quarter versus 2019. The amount of gross receipts decline is either 50% in comparing 2020 to 2019 or 20% when comparing 2021 versus 2019.
• This credit can be claimed through Dec. 31, 2021.

Next steps: File for this credit through your payroll reporting. The maximum credit is $7,000 per employee per quarter. This credit effectively reduces the amount of the business’s portion of Social Security tax payments. Other limits apply.

There are many more provisions in the close to $2 trillion dollar spending package, including money given to states. As everyone digests this 500-plus page piece of legislation, more clarifications will be forthcoming from the IRS and other sources.