Allows the credit to be claimed against Medicare (1.45%, Hospital Insurance – HI) taxes only.experiences a full or partial suspension of operations due to a governmental order or experiences a significant gross receipts decline.Began operations after February 15, 2020, whose average annual gross receipts for a 3-taxable-year period ending with the taxable year which precedes such quarter does not exceed $1 million and.Limits the ERTC to $50,000 per calendar quarter of an eligible employer that is a “recovery startup business.” A “recovery startup business” is one that:.Considering the CAA extension and the pending ARPA extension, this means an employer would potentially have up to $40,000 in qualified wages per employee through 2021. It also continues to allow for up to $10,000 in qualified wages for any calendar quarter. The legislation would continue the ERTC rate of credit at 70% for this extended period of time. Extends the ERTC from June 30, 2021, until December 31, 2021.In the meantime, below is a little more about how the ARPA will impact employers and business owners who are eligible for or who have already received Paycheck Protection Program Loans or Employee Retention Tax Credits:ĪRPA allocates an additional $7.25 billion towards PPP funding however, the application period has not been extended and remains March 31, 2021. Much of the ARPA extends and expands on the provisions from earlier Covid-relief legislation, including the Families First Coronavirus Relief Act (FFCRA), Coronavirus Aid, Relief and Economic Security (CARES) Act, and the Consolidated Appropriations Act, 2021 (CAA).Īs you would expect with bill of this magnitude, the law is very complex, and we will continue to monitor guidance from the Small Business Administration and keep you posted on how the various provisions will impact you. The latest Covid-relief bill – the $1.9 trillion American Rescue Plan Act of 2021 (ARPA) – was signed into law by President Biden, and it provides several provisions specifically beneficial to restaurant owners and to small business owners and individuals in general.
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