Recently, President Trump signed the second COVID-19 stimulus bill, which includes some rather special benefits for small businesses (i.e., companies with 100 employees or less). The new bill allows for both retroactive and prospective changes to the Employee Retention Credit (ERC). It is now possible for businesses that received a Paycheck Protection Program (PPP) loan in 2020 to potentially also benefit from the ERC. You may recall, prior to these changes, a business could either get a PPP loan or take the ERC. They could not have both. In addition, the new bill extends the ERC period to cover the first two quarters of 2021. The extended period now covers wages from January 1, 2021 to June 30, 2021. The rules for the 2021 credit are significantly different and could provide opportunities for employers that did not previously qualify for the ERC.
It’s no secret that the pandemic has changed the landscape of the working world. With so many employees telecommuting, the requirements around income tax in some states is being effected. In fact, in many states, having just one telecommuting employee can create Nexus.
This year on January 1, a new law put the Workforce Education Surcharge into effect. This means that a new three-tiered surcharge applies to the amount of tax payable under the Service and Other Activities B&O tax classification by businesses “primarily engaged” in one or more specific activities.