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I would bet that you haven’t heard of this before. The new Coronavirus law allows eligible employers, including self-employed contractors and other independent contractors who have employees to receive a nice 50% payroll tax credit up to $5,000 per employee (50% of $10,000 in wages) paid after March 12, 2020 and before January 1, 2021.
So who is eligible: This applies to any business who have experienced more than a 50% reduction in quarterly gross receipts measured year over year and have some employees.
To qualify, your business must be fully or partially suspended by government order due to COVID-19 during the calendar quarter, OR your gross receipts are below 50% of the comparable quarter in 2019. These measures are calculated each calendar quarter. The credit is based on the wages paid to all employees even if you furloughed or laid off the workers and generally applies to firms of under 100 employees.
NOTE: This credit is in ADDITION to the payroll Protection loans or the $10,000 Employer Disaster Loan Program (EIDL) that I have previously mentioned including unemployment insurance benefits. Unlike some of the other benefits mentioned, this credit won’t apply to your lost income. It applies to reduced gross receipts as long as you had employees.
We know that many of you are experiencing some financial pain. However, there are a LOT of benefits that are available to you that should cover most of your loss for at least two and one-half months, absent renewal of these programs. The problem is that it will take a few weeks to get to you. Hang in there. We will be constantly be providing tips each weekday to help you put more needed money in your pocket where it belongs.
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