Other critical provisions in the bill include tax provisions that will help businesses maintain liquidity through this national crisis.

  • Retention Tax Credit. Creates a refundable payroll tax credit for 50 percent of wages paid by employers to employees during the COVID-19 crisis.
  • Qualifying Employers are those whose (1) operations were fully or partially suspended, due to a COVID-19-related shut- down order, or (2) gross receipts declined by more than 50 percent when compared to the same quarter in the prior year.
  • For employers with greater than 100 full-time employees, qualified wages are wages paid to employees when they are not providing services due to the COVID-19-related circumstances described above.
  • For eligible employers with 100 or fewer full-time employees, all employee wages qualify for the credit, whether the employer is open for business or subject to a shut-down order.
  • The credit is capped at $10,000/quarter per employee, including health benefits paid.
  • The credit is provided for wages paid or incurred from 3/13/2020 through 12/31/2020.
  • Delay of payment of employer payroll taxes. Payment would be due over the course of two years with half due 12/31/2021 and the balance due 12/31/2022.
  • Modification for net operating losses (NOL). This provision would allow five-year carryback for 2018, 2019, and 2020 tax years, respectively.
  • Modification of limitation on losses for taxpayers other than corporations. The 80 percent carryback limitation would be lifted for pass-through entities to harmonize with corporate NOL treatment for 2018, 2019, and 2020.
  • Modification of credit for prior year minimum tax liability of corporations. This would accelerate the ability of companies to recover AMT credits in the form of refunds.
  • Modification of limitation on business interest. This would loosen the limitation on interest deduction to 50 percent of EBITDA for 2019 and 2020.
  • Technical amendments regarding qualified improvement property (QIP). This fix to the so-called “retail glitch” would unlock $15 billion in liquidity for QIP expenses incurred by hard-hit sectors like restaurants, hotels, and retail, among others.

Families First Coronavirus Response Act—DOL Resources

On March 26, the U.S. Department of Labor issued additional guidance explaining paid sick leave and expanded family and medical leave under the Families First Coronavirus Response Act:

ABC Coronavirus Update webpage:  https://abc.org/coronavirus