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March 15, 2021 |  How To Prepare To Apply For Independent Restaurant & Bar Grants Once They Are Available

A $28.6 billion restaurant and bar grant program will be made available soon. Members of the Independent Restaurant Coalition partnered with members of Congress to craft the legislation. While the Small Business Administration prepares to stand up the program, businesses should take steps to organize the materials necessary to submit an application once it is available. Below is a bit of information about the program, and
what businesses can do to prepare for the application:


ABOUT THE GRANT PROGRAM


Is my business eligible?
Food service or drinking establishments, including caterers, brewpubs, taprooms, and tasting rooms, that are not part of an affiliated group with more than 20 locations. An entity cannot be publicly traded or have a pending application under the Save our Stages program and there are limits on the participation of private equity funds.

How much is my business eligible for?

When did my business open   /  What is my business eligible to receive?

Prior to 2019 = (2019 revenue) - (2020 revenue + PPP loans)

During 2019 = (12 x 2019 revenue / months open in 2019) - (2020 revenue + PPP loans)

During 2020 = eligible expenses incurred

Grants cannot exceed $10 million per restaurant group, or $5 million per individual restaurant.

What expenses can I use this grant on?


Payroll and benefits (not including employee compensation exceeding $100,000/year), mortgage (no prepayment), rent (no prepayment), utilities, maintenance, construction to accommodate outdoor seating, supplies (including protective equipment and cleaning materials), food and beverage expenses, operational expenses, covered supplier costs as defined by the SBA under the PPP program, sick leave, and any other expenses deemed essential by the Administrator.

Grants can be spent on eligible expenses from 2/15/20 through 12/31/21 and the Administrator may extend the period through two years from enactment if conditions warrant.


When will I be able to access this grant?
Once the legislation becomes law, it will take time for the SBA to develop the necessary guidance to applicants and the actual application for restaurant and bar owners to apply for a grant.\


HOW DO I APPLY?
Please note: navigating government websites can be challenging and frustrating. Incredible attention to detail is required to complete successful registration. Additionally, websites offering a fee for expedited services are often fraudulent, please adhere to the government websites.


What does my business need?
To receive a grant you will need a Data Universal Numbering System (DUNS) number and be registered with the System for Award Management (SAM). You will not be able to apply or receive payments without establishing your business in both of these systems.

Information  /   Description

  • DUNS number: DUNS is a nine-character identification number, which is a proprietary means of identifying businesses on a location-specific basis developed by Dun & Bradstreet.  It is free.  
  • SAM Registration: SAM (System for Award Management) is the Official US Government system that consolidates the Central Contractor Registration (CCR), Federal Contract Registry (FedReg) Online Representations and Certifications Application (ORCA), and Excluded Parties List System (EPLS).

How do I register for a DUNS number?
Prepare the required information:

  • Name of business 
  • Business address
  • Name of business owner
  • Legal structure of business (e.g., corporation, partnership, proprietorship)
  • Year the business first opened
  • Primary type of business
  • Total number of employees (full and part-time)
  • Banking information

Call the Dun & Bradstreet hotline (1-866-705-5711), or visit their website. Receiving your DUNS number will likely take 2-3 days. Make sure to record the exact information you provide, this will be important for SAM.


How do I register with SAM?
You must first have a DUNS number to complete the SAM registration. Prepare the required information for SAM registration:

  • Create an account by visiting: https://login.gov/create-an-account/ (note this is different than your SAM account)
  • Working phone number
  • Tax identification number
  • CAGE number (if do not have, one will be assigned to you)
  • Banking information


To register for SAM, follow the following steps:

  1. Use your login.gov account to log into SAM here.
  2. Once you have logged in, create an individual SAM user account.
  3. Select the entity registrations from the menu on the lower half of the page and choose Register New Entity. For why you are applying choose “to apply for Federal financial assistance opportunities only”.
  4. Make sure the data you provide exactly matches the information entered in DUNS. You will be asked for banking information, tax information, and your CAGE number, which will be assigned to you if you do not have it.
  5. You will receive an email from SAM.gov when your registration becomes active.

The final step in the process is submitting your notarized letter to the Federal Service Desk. Here is a bit of information how to structure that letter:

  • Your business’ letterhead, and be signed by your business’ owner, or other authorized signer.
  • Your DUNS number.
  • Central Contractor Registration primary point of contact, or alternate point of contact (if applicable)
    ● Business owner’s name, phone number, address, and email.
    ● Provide justification for registration.
    ● Contain the following passage, with relevant information provided (see bold):
    ○ “The purpose of this notarized letter is to designate [insert name of Entity Administrator] as Entity Administrator for [company]. I, [name and title of signatory], hereby confirm that [Insert name of Entity Administrator] is an authorized officer, agent, or representative of [insert entity name, or, for individuals representing themselves, say him/herself]. This
    letter will authorize [Insert name of Entity Administrator] to have access to the System for Award Management (SAM). SAM is a computer system managed by the Federal Government, and it is only accessible by individuals who are either authorized to represent a particular entity, or by individuals representing themselves. Accessing or using SAM, or information contained therein, for any unauthorized or illegal purposes, may have civil and criminal penalties, and
    may negatively impact the status of the SAM registration maintained on this entity. I, the below-signed, attest to the accuracy of all information contained in this letter.”
    ● Note: if your business is not operated by a third party, include the following:
    ○ “For the purpose of registering with the United States Federal Government through the online
    System for Award Management (SAM), I do not authorize any 3rd party to act on behalf of
    [company organization, agency].”
    ● Note: if your business is operated by a third party, include the following:
    ○ “For the purpose of registering with the United States Federal Government through the online
    System for Award Management (SAM), I do hereby authorize [Enter name of 3rd Party Agent]
    to act on behalf of [company, organization, agency.] This authorization permits [Enter name of 3rd Party Agent] to conduct all normal, common business functions within SAM while binding signatory to all actions conducted and representations made as a result of authorization granted herein. I forever hold harmless the United States Government, the System for Award Management, and all associated entities from all action and causes of actions, suits, claims, attorney fees, or demands resulting from the authorization granted herein.”


Templates of letters can be found here:
Template 1 - Single Entity
Template 2 - Multiple Domestic Entities

How to submit SAM registration letter to Federal Service Desk

  1. The first step to scanning this letter is logging into www.fsd.gov by using your login.gov account.
  2. Click Create an Incident.
  3. Select System for Award Management (SAM) in the System Name Field. 
  4. Select SAM: Notarized Letter in the Issue Type field.  Fill out remaining fields.
  5. Select the Paperclip icon to add attachments and attached your scanned notarized letter.
  6. Once you have filled ou all required information and attached your notarized letter, click Submit.


Independent Restaurant Coalition

March 12, 2021 |  Payroll Provisions of the American Rescue Plan Act

The American Rescue Plan, 2021 (ARPA, 2021) was signed by President Biden on March 11, 2021 to address the continuing economic impact on employers and employees the coronavirus (COVID-19) pandemic has posed. President Biden is expected to sign the bill. The legislation extends and expands provisions found in the Families First Coronavirus Relief Act (FFCRA), Coronavirus Aid, Relief and Economic Security (CARES) Act, and the Consolidated Appropriations Act, 2021 (CAA, 2021).  

Paid Sick and Family Leave Credits

Changes under ARPA apply to amounts paid with respect to calendar quarters beginning after March 31, 2021. ARPA, 2021:

 

  • Extends the FFCRA paid sick time and paid family leave credits from March 31, 2021 through September 30, 2021. 
  • Provides that paid sick and paid family leave credits may each be increased by the employer's share of Social Security tax (6.2%) and employer's share of Medicare tax (1.45%) on qualified leave wages.
  • Permits the Treasury Secretary to waive for failure to deposit penalties on "applicable employment taxes" if the failure to deposit is due to an anticipated credit. "Applicable employment taxes" are defined as the employer's share of Medicare or Tier 1 RRTA tax. 
  • Allows for the credits for paid sick and family leave to be structured as a refundable payroll tax credit against Medicare tax only (1.45%), beginning after March 31, 2021.
  • Increases the amount of wages for which an employer may claim the paid family leave credit in a year from $10,000 to $12,000 per employee.
  • Expands the paid family leave credit to allow employers to claim the credit for leave provided for the reasons included under the previous employer mandate for paid sick time. For the self-employed, the number of days for which self-employed individuals can claim the paid family leave credit is increased from 50 to 60 days. 
  • Permits the paid sick and family leave credit to be claimed by employers who provide paid time off for employees to obtain the COVID-19 vaccination or recover from an illness related to the immunization.  
  • Increases the paid sick and family leave credit by the cost of the employer's qualified health plan expenses and by the employer's collectively bargains contributions to a defined benefit pension plan (as defined under Code Sec. 414(j) ) and the amount of collectively bargained apprenticeship program contributions.
  • Establishes a non-discrimination requirement where no credit will be permitted to any employer who discriminates in favor of highly-compensated employees as defined under Code Sec. 414(q) , full-time employees, or employees on the basis of employment tenure. 
  • Resets the 10-day limitation on the maximum number of days for which an employer can claim the paid sick leave credit with respect to wages paid to an employee. The current 10-day limitation runs from the start of the credits in 2020 through March 31, 2021. For the self-employed, the 10-day reset applies to sick days after January 1, 2021 for self-employed individuals. 
  • Clarifies that while no credit for paid sick and family leave may be claimed by the federal government or any federal agency or instrumentality, this would not apply to any organization described under Code Sec. 501(c)(1) and exempt from tax under Code Sec. 501(a) , including state and local governments.


Employee Retention Credit

The new legislation:

  • Extends the ERC from June 30, 2021 until December 31, 2021. The legislation would continue the ERC rate of credit at 70% for this extended period of time. It also continues to allow for up to $10,000 in qualified wages for any calendar quarter. Taking into account 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. 
  • Limits the ERC to $50,000 per calendar quarter of an eligible employer that is a "recovery startup business" as defined in  Code Sec. 3134(c)(5) . A "recovery startup business" is one that: (1) 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 $1,000,000, and (2) experiences a full or partial suspension of operations due to a governmental order or experiences a significant gross receipts decline.
  • Allows the credit to be claimed against Medicare (1.45%, Hospital Insurance - HI) taxes only. Since the employer/employee tax rate for Medicare is 1.45%, it could take longer to immediately claim the credit under the ARPA for the third and fourth quarters of 2021. Instead of just withholding the taxes immediately, it could be more likely that more employers would need to file Form 7200 (Advance Payment of Employer Credits Due to COVID-19).
  • Continues the year-over-year gross receipts decline requirement at 20%; and the threshold for qualified wages (even if the employee is working) would continue to be 500 employees, as expanded by the CAA. Also, certain governmental employers would continue to be exempt from claiming the ERC, except certain tax exempt organizations that would include colleges and universities or medical or hospital care providers.
  • Requires the Treasury Secretary to issue guidance providing that payroll costs paid during the covered period would not fail to be treated as qualified wages to the extent that a covered loan under the Small Business Act is not forgiven. As with the expansion of the ERC under the CAA, this would continue to mean that Paycheck Protection Program (PPP) recipients would be eligible if the loan did not pay the wages in question.
  • Qualified wages paid by an employer taken account as payroll costs under (1) Second Draw PPP loans; (2) shuttered venues assistance and (3) restaurant revitalization grants are not eligible for the ERC.


Unemployment Provisions

The new legislation:

  • Extends continued unemployment provisions to September 6, 2021. This would include the: (1) pandemic unemployment assistance (PUA), (2) federal pandemic unemployment compensation (FPUC), (3) pandemic emergency unemployment compensation (PEUC), (4) the funding for waiving the one-week unemployment benefit waiting period, (5) the temporary financing of short-time compensation (STC) payments for states with programs, (6) STC agreements for states without programs, (7) temporary assistance for states with federal unemployment advances, and (8) the full federal funding of extended unemployment compensation.
  • Observation: Further temporary suspension on the accrual of interest on federal unemployment loans to states and a waiver of interest payments under the ARPA assists certain employers that otherwise would have to pay an unemployment tax assessment.
  • Extends the FPUC unemployment payment of $300 per week through September 6, 2021.
  • Does not extend the 50% credit for reimbursing employers.


Paycheck Protection Program Modifications

The new legislation:

  • Allocates an additional $7.25 billion towards PPP funding, however, the application period has not been extended and remains March 31, 2021.
  • Adds "additional covered nonprofit entity" as an eligible nonprofit eligible for First Draw and Second Draw PPP loans. An "additional covered nonprofit entity" is an organization listed in  Code Sec. 501(c) other than those Code Sec. 501(c)(3) Code Sec. 501(c)(4) Code Sec. 501(c)(6) , or  Code Sec. 501(c)(19) . An "additional covered nonprofit entity" is eligible for a PPP loan if: (1) the organization employs no more than 300 employees; (2) it does not receive more than 15% of its receipts from lobbying activities; (3) lobbying activities do not comprise more than 15% of the organization's total activities; and (4) the cost of lobbying activities does not exceed $1,000,000 during the most recent tax year that ended prior to February 15, 2020.
  • Adds the following to eligible entities for PPP loans: (1) Code Sec. 501(c)(3) nonprofit and veterans' organizations with up to 500 employees; and (2)  Code Sec. 501(c)(6) nonprofit organizations (business leagues, chambers of commerce, real estate boards, boards of trade and professional football leagues); and (3) domestic marketing organizations with no more than 300 employees per physical location.
  • Adds Internet-only news publishing and Internet-only periodical publishers to businesses eligible for First and Second Draw PPP loans. To be eligible, the organization must employ no more than 500 employees.
  • Provides that amounts used from First Draw and Second Draw PPP loans for premiums used to determine the credit for COBRA premium assistance as provided under Code. Sec. 6432 are eligible for loan forgiveness. See  Pension and Benefits Related Provisions below for further information regarding COBRA.


Other Relief-Related Provisions

Restaurant revitalization grants.  ARPA appropriates $28,600,000,000 for fiscal year 2021 to struggling restaurants to be administered by the SBA. The money will be available until expended. Eligible entities include restaurants, or other specified food businesses, and includes businesses operating in an airport terminal. It does not include a state or local government operated business, or a company that as of March 13, 2020 operates in more than 20 locations, whether or not the locations do businesses under the same name. It also does not include any business that has a pending application for, or has received, and grant under the Economic Aid to Hard-Hit Small Businesses, Non-Profits and Venues Act. The amount given to any business who fulfills the eligibility and certification requirements is $10,000,000 and limited to $5,000,000 per physical location of the business. Grants may be used for:  (1) payroll costs; (2) mortgage payments; (3) rent; (4) utilities; (5) maintenance expenses; (6) supplies; (7) food and beverage expenses; (8) covered supplier costs; (9) operational expenses; (10) paid sick leave; and (11) any other expense determined to be essential to maintaining the business. 

Shuttered venue operators. CAA, 2021 authorized grants to eligible live venue operators or promoters, theatrical producers, live performing arts organization operators, museum operators, motion picture theatre operators, or talent representatives who demonstrate a 25% reduction in revenues. ARPA appropriates $1,250,000,000, for fiscal year 2021, to help carry out these grants. The money will be available until expended. Governmental entities do not qualify.

Aviation manufacturing job protection. ARPA establishes a payroll support program for the continuation of employee wages, salaries and benefits for aviation manufacturing employers who have furloughed at least 10% of its workforce in 2020 compared to 2019, or experienced a 15% decline in revenues from 2019 to 2020 (although separate qualifications are set forth for companies that had no involuntary furloughs. 

Additional relief provisions. ARPA establishes funds to assist the National Railroad Passenger Association and airports financially impacted by COVID-19.


Earned Income Credit

For tax years beginning after December 31, 2020, and before January 1, 2022, for taxpayers with no qualifying children:

  • The 7.65% credit percentage and phaseout percentage is increased to 15.3%.
  • The $4,220 earned income amount is increased to $9,820.
  • The $5,280 phaseout amount is increased to $11,610. These amounts are not adjusted for inflation.
  • Observation: ARPA does not mention any change to the $5,000 amount for married taxpayers. Presumably, then, the phaseout amount for married taxpayers is $16,610 (using the unadjusted $5,000 amount).


Benefits Related Provisions

Dependent Care Assistance. The amount of taxable wage exclusion for dependent care benefits is increased from $5,000 to $10,500 for married couples filing jointly. The amount of excludable wages for married couples filing separately is $5,250. This increase applies to any taxable year beginning after December 31, 2020, and before January 1, 2022,  effective December 31, 2020.

COBRA. Under ARPA, Assistance Eligible Individuals (AEIs) may receive an 85% subsidy for COBRA premiums paid during any period of COBRA coverage during the period beginning on April 1, 2021 (the first day of the first month beginning after enactment) and ending on September 30, 2021.  

  • Refundable tax credit. Employers will be allowed a quarterly tax credit against the Medicare payroll tax equal to the premium amounts not paid by AEIs. If the credit amount exceeds the quarterly Medicare payroll tax, the excess will be treated as an overpayment refundable under Code Sec. 6402(a) and Code Sec. 6413(b) . The quarterly credit may be paid in advance according to forms and instructions to be provided by the Department of Labor.  
  • Notice requirements.  Group health plans must provide the following notices to AEIs:
  1. Notice of assistance availability. Informs AEIs of the availability of the subsidy and the option to enroll in different coverage (if permitted by the employer). Must be provided to individuals who become eligible to elect COBRA during the period beginning on April 1, 2021, and ending on September 30, 2021. This notice requirement may be met by amending existing notices or including a separate document along with them. Specific content requirements apply. 
  2. Notice of extended election period. Must be provided to individuals eligible for an extended election period within 60 days after April 1, 2021.  
  3. Notice of expiration of subsidy. Must be provided between 45 and 15 days before the date on which an individual's subsidy will expire, unless the subsidy is expiring because the individual has gained eligibility for coverage under another group health plan or Medicare.
  • Provision of these notices is required in order to meet COBRA's notice requirements.Model notices.  Within 30 days of enactment, the Department of Labor is to issue model notices which can be used to notify eligible individuals of the availability of assistance and the availability of an extended enrollment period. Within 45 days, the Department is to issue model notices regarding the expiration of the subsidy.

 

© 2021 Thomson Reuters/Tax & Accounting. All Rights Reserved.

WEBINAR |&#160;<strong>Putting Together Your Estate &#38; Long Term Care Plan</strong>&#160;<em>March 10, 2021 6PM</em>

WEBINAR | Putting Together Your Estate & Long Term Care Plan March 10, 2021 6PM

Wednesday, March 10, 2021

6:00 PM - 7:30 PM on Zoom

Join David Younis CFP®, Director of Financial Services at Allied Financial Partners and Marcus Kroll, Esq. of Kroll Law Firm, LLP, for a conversation to discuss the most pressing concerns regarding effective estate and long-term care planning.

Featured Topics Will Include:

  • The importance of having a plan in place before you need one to ensure that your wishes are carried out according to your specifications.
  • What documents to have in place to organize your affairs so they don’t become a burden for the people you love.
  • How will you pay for your care; there are many options available, which is the right one for you?

We encourage you to share this invitation with interested family members or friends that would benefit from this educational seminar.

Click Here To Register

February 10, 2021 |  CLIENT ALERT: NYS Unemployment Benefit Fraud

The New York State Department of Labor Stops Fraudsters from Stealing More Than $5.5 Billion in Unemployment Benefits During Covid-19 Pandemic

Since the beginning of the Pandemic, New York State has Paid more than $65 billion in Unemployment Benefits to over 4 Million New Yorkers 


NYS Department of Labor has Identified Over 425,000 Fraudulent Claims, Continues PSA Campaign Warning New Yorkers to Protect Themselves Against Fraud

The New York State Department of Labor today announced that it has identified over 425,000 fraudulent unemployment benefit claims during the COVID-19 pandemic, preventing fraudsters from stealing more than $5.5 billion in benefits. The DOL has referred hundreds of thousands of fraud cases to federal prosecutors, and continues to work with law enforcement partners on the federal, state, and local level to hold fraudsters accountable.

Since the pandemic began in March 2020, the Department of Labor has paid over $65 billion to more than 4 million New Yorkers - representing more than 30 typical years' worth of benefits paid in just 11 months.

"Unemployment fraud is - sadly - a scourge that we have to fight every day, but it is particularly despicable that criminals would use a global pandemic as cover to attempt to defraud our system. These benefits have been a lifeline for millions of New Yorkers over the last year, and every day our Office of Special Investigations is working to protect our system from fraud and abuse," said New York State Labor Commissioner Roberta Reardon. "Our team is using technology, including artificial intelligence and other sophisticated techniques, to identify fraud as quickly as possible and stop these criminals in their tracks. We will continue to work with our law enforcement partners at all levels to bring these thieves to justice."

Criminals are using real New Yorkers' identities - likely stolen during previous data breaches involving institutions like banks, insurance companies, and major employers - to file fraudulent claims and illegally collect benefits in the name of individuals who are not unemployed. In response to this uptick in fraudulent claims, the Department of Labor Commissioner and Department of Financial Services have launched a public service announcement campaign, educating New Yorkers about how to protect themselves against identity theft, which can be viewed here. Anyone who receives a monetary determination letter from the Department of Labor, but did not apply for unemployment benefits, should immediately report it to the DOL at on.ny.gov/uifraud.

In addition, these New Yorkers should take steps to proactively protect themselves, including those listed at report.com;

  • Reporting the identity theft to the FTC;
  • Filing a report with their local police department, if they wish; and
  • Reporting a misused Social Security number.

In addition to the Office of Special Investigation's robust investigative efforts, the Department of Labor receives information from sources including other government agencies, claimants, and employers to fight fraud. The Department of Labor also works closely with law enforcement partners at all levels, including the US DOL Office of Inspector General, the Secret Service, and the FBI.

Since March, the Department of Labor has identified over 425,000 fraudulent claims during the COVID-19 crisis -- thanks to these proactive efforts, and strong protections built into the application system, over $5.5 billion that would have gone to fraudsters has been protected. A vast majority of the fraudulent claims were caught before a single cent was paid, and the Department of Labor continues to aggressively combat unemployment insurance fraud.

January 28 2021 | Employee Retention Credit Extended Through June 2021

The Internal Revenue Service urges employers to take advantage of the newly-extended employee retention credit, designed to make it easier for businesses that, despite challenges posed by COVID-19, choose to keep their employees on the payroll.

The Taxpayer Certainty and Disaster Tax Relief Act of 2020, enacted December 27, 2020, made a number of changes to the employee retention tax credits previously made available under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), including modifying and extending the Employee Retention Credit (ERC), for six months through June 30, 2021. Several of the changes apply only to 2021, while others apply to both 2020 and 2021.

As a result of the new legislation, eligible employers can now claim a refundable tax credit against the employer share of Social Security tax equal to 70% of the qualified wages they pay to employees after December 31, 2020, through June 30, 2021. Qualified wages are limited to $10,000 per employee per calendar quarter in 2021. Thus, the maximum ERC amount available is $7,000 per employee per calendar quarter, for a total of $14,000 in 2021.

Employers can access the ERC for the 1st and 2nd quarters of 2021 prior to filing their employment tax returns by reducing employment tax deposits. Small employers (i.e., employers with an average of 500 or fewer full-time employees in 2019) may request advance payment of the credit (subject to certain limits) on Form 7200, Advance of Employer Credits Due to Covid-19, after reducing deposits. In 2021, advances are not available for employers larger than this.

Effective January 1, 2021, employers are eligible if they operate a trade or business during January 1, 2021, through June 30, 2021, and experience either:

  1. A full or partial suspension of the operation of their trade or business during this period because of governmental orders limiting commerce, travel or group meetings due to COVID-19, or
  2. A decline in gross receipts in a calendar quarter in 2021 where the gross receipts of that calendar quarter are less than 80% of the gross receipts in the same calendar quarter in 2019 (to be eligible based on a decline in gross receipts in 2020 the gross receipts were required to be less than 50%).

Employers that did not exist in 2019 can use the corresponding quarter in 2020 to measure the decline in their gross receipts. In addition, for the first and second calendar quarters in 2021, employers may elect in a manner provided in future IRS guidance to measure the decline in their gross receipts using the immediately preceding calendar quarter (i.e., the fourth calendar quarter of 2020 and first calendar quarter of 2021, respectively) compared to the same calendar quarter in 2019.

In addition, effective January 1, 2021, the definition of qualified wages was changed to provide:

  • For an employer that averaged more than 500 full-time employees in 2019, qualified wages are generally those wages paid to employees that are not providing services because operations were fully or partially suspended or due to the decline in gross receipts. 
  • For an employer that averaged 500 or fewer full-time employees in 2019, qualified wages are generally those wages paid to all employees during a period that operations were fully or partially suspended or during the quarter that the employer had a decline in gross receipts regardless of whether the employees are providing services. 

Retroactive to the March 27, 2020, enactment of the CARES Act, the law now allows employers who received Paycheck Protection Program (PPP) loans to claim the ERC for qualified wages that are not treated as payroll costs in obtaining forgiveness of the PPP loan.

For more information, see COVID-19-Related Employee Retention Credits: How to Claim the Employee Retention Credit FAQs.

January 07 2021 | Employee Retention Credit

UPDATE: Originally, employers were not eligible to receive the Employee Retention Credit if they received a Paycheck Protection Program (PPP) loan. However, due to changes made by the Consolidated Appropriations Act, 2021, this restriction has been lifted. This means that due to the retroactive change employers who took PPP loans are now eligible to take the employee retention credit, so long as the same wages are not used for both.


The Employee Retention Credit is a refundable tax credit against certain employment taxes equal to 50 percent of the qualified wages an eligible employer pays to employees after March 12, 2020, and before January 1, 2021. Eligible employers can get immediate access to the credit by reducing employment tax deposits they are otherwise required to make. Also, if the employer's employment tax deposits are not sufficient to cover the credit, the employer may get an advance payment from the IRS.

For each employee, wages (including certain health plan costs) up to $10,000 can be counted to determine the amount of the 50% credit. Because this credit can apply to wages already paid after March 12, 2020, many struggling employers can get access to this credit by reducing upcoming deposits or requesting an advance credit on Form 7200, Advance of Employer Credits Due To COVID-19.

Employers, including tax-exempt organizations, are eligible for the credit if they operate a trade or business during calendar year 2020 and experience either:

  1. the full or partial suspension of the operation of their trade or business during any calendar quarter because of governmental orders limiting commerce, travel, or group meetings due to COVID-19, or
  2. a significant decline in gross receipts. 

A significant decline in gross receipts begins:

  • on the first day of the first calendar quarter of 2020
  • for which an employer’s gross receipts are less than 50% of its gross receipts
  • for the same calendar quarter in 2019.

The significant decline in gross receipts ends:

  • on the first day of the first calendar quarter following the calendar quarter
  • in which gross receipts are more than of 80% of its gross receipts
  • for the same calendar quarter in 2019.

The credit applies to qualified wages (including certain health plan expenses) paid during this period or any calendar quarter in which operations were suspended.

Qualified wages

The definition of qualified wages depends on how many employees an eligible employer has.

If an employer averaged more than 100 full-time employees during 2019, qualified wages are generally those wages, including certain health care costs, (up to $10,000 per employee) paid to employees that are not providing services because operations were suspended or due to the decline in gross receipts. These employers can only count wages up to the amount that the employee would have been paid for working an equivalent duration during the 30 days immediately preceding the period of economic hardship.

If an employer averaged 100 or fewer full-time employees during 2019, qualified wages are those wages, including health care costs, (up to $10,000 per employee) paid to any employee during the period operations were suspended or the period of the decline in gross receipts, regardless of whether or not its employees are providing services.

Impact of other credit and relief provisions

An eligible employer's ability to claim the Employee Retention Credit is impacted by other credit and relief provisions as follows:

  • If an employer receives a Small Business Interruption Loan under the Paycheck Protection Program, authorized under the CARES Act, then the employer is not eligible for the Employee Retention Credit.
  • Wages for this credit do not include wages for which the employer received a tax credit for paid sick and family leave under the Families First Coronavirus Response Act.
  • Wages counted for this credit can't be counted for the credit for paid family and medical leave under section 45S of the Internal Revenue Code.
  • Employees are not counted for this credit if the employer is allowed a Work Opportunity Tax Credit under section 51 of the Internal Revenue Code for the employee.

Claiming the credit

In order to claim the new Employee Retention Credit, eligible employers will report their total qualified wages and the related health insurance costs for each quarter on their quarterly employment tax returns, which will be Form 941 for most employers, beginning with the second quarter. The credit is taken against the employer's share of social security tax but the excess is refundable under normal procedures.

In anticipation of claiming the credit, employers can retain a corresponding amount of the employment taxes that otherwise would have been deposited, including federal income tax withholding, the employees' share of Social Security and Medicare taxes, and the employer's share of Social Security and Medicare taxes for all employees, up to the amount of the credit, without penalty, taking into account any reduction for deposits in anticipation of the paid sick and family leave credit provided in the Families First Coronavirus Response Act PDF

Eligible employers can also request an advance of the Employee Retention Credit by submitting Form 7200.

More Information


Information provided by irs.gov

NYS Mandatory Paid Sick Leave Updates

Beginning September 30, 2020, employees in New York must accrue protected sick leave but employees are NOT entitled to use their accrued sick leave until January 1,
2021. Here is a summary based on the law in its current form. We expect additional guidance from the NY Commissioner of Labor as we approach the effective date.

Applicability:


All employers are required to provide protected sick leave, but whether itʼs paid and the amount of annual sick leave depend on the size and net income of the employer:
• 4 or fewer employees and net income of $1 million or less: 40 hours, unpaid.
• 4 or fewer employees and net income of more than $1 million: 40 hours, paid.
• 5–99 employees: 40 hours, paid.
• 100+ employees: 56 hours, paid.

Employer may choose any regular, consecutive twelve-month period as the benefit year, except that the number of employees is determined on a calendar year
(January 1 through December 31). The statute does not specifically allow employers to exclude employees who work outside New York from its calculation.


Accrual:
All employees, including part-time and temporary employees, who do not work in the state are required to accrue 1 hour of paid sick leave for every 30 hours worked: accrual begins on September 30, 2020, or the employeeʼs first day of work, whichever is later.


Employees are entitled to carry over all their unused sick leave hours: however, employers may limit annual use to the caps outlined in the bullet points above.
Instead of an hourly accrual method, employers may choose to front-load their employeesʼ sick leave hours at the beginning of each year. If they do so, however, they may not reduce their sick leave allotment if the employee works less than expected.


Usage:
Yearly usage may be capped at 40 hours for employers with fewer than 100 employees and at 56 hours for employers with 100 or more employees. Other than the
usage start date of January 1, 2021, the law does not allow employers to impose a waiting period before an employee can use their accrued sick leave.

Client Alert: Unemployment Benefits Scam

The FBI is currently investigating an active unemployment insurance scam. The scam involves letters about unemployment insurance that are legitimately from the New York State Department of Labor but are being sent to individuals who did not apply for the payments.

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March 31 2020 | AFP Solutions For Social Distancing: COVID-19

With growing concerns about Covid-19 (the Coronavirus) many people have started practicing social distancing to protect themselves, the health of those around them, and the community as a whole.

Despite it all tax season marches on, however you have the option to skip an in-person appointment in favor of sending your documents in to be processed. Documents can be mailed in or dropped of to the office location of your choice.  Please call our office if you would like to make arrangements to drop off documents without having to enter the building.  You can also submit documents electronically on our website using our online portal.

Online portal

- For instructions on how to upload documents to the portal click here.  

- If you have a portal but need assistance accessing it or uploading documents call Andrea True at (585) 410-6733 ext. 103.

- If you don't have a portal set up already and would like one, please email Chelsea Hewitt at chewitt@aliedfp.com.

For our financial services clients we have the ability to provide digital investment review meetings.

To schedule a digital investment review meeting with David Younis CFP® or Francis Celona CPA, CFP® contact Aimee Cummings at (585) 410-6733 ext. 136 or acummings@alliedfp.com.

Appointments with Jason Tabor CFP® can be scheduled with Debbie Pearlmutter at (607) 282-4161 or dpearlmutter@alliedfp.com.


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Feb 25 2020 | Angela Dussault, CPA Joins Allied Financial Partners as Manager

The partners of Allied Financial Partners are pleased to announce that Angela Dussault, CPA has joined Tette, Ingersoll & Co., CPAs, PC, a division of Allied Financial Partners.

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Feb 11 2020 | The SECURE Act

The Setting Every Community Up for Retirement Enhancement (SECURE) Act is now law. With it, comes some of the biggest changes to retirement savings law in recent years.

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Jan 31 2020 | Richard A Romer, CPA, LLC Merges with Allied Financial Partners

Tette, Ingersoll & Co. CPAs, PC, a division of Allied Financial Partners, is pleased to announce its merger with Richard A Romer, CPA LLC, in order to grow its services and capabilities.

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Jan 30 2020 | Allied Financial Partners Announces Promotion of Four Employees

The partners of Allied Financial Partners are pleased to announce the promotions of four dedicated employees.

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Jan 28 2020 | Sarah Gordnier Joins Allied Financial Partners as Administrative Assistant

The partners of Allied Financial Partners are pleased to welcome Sarah Gordnier who joins the administrative team working out of both the Rochester and Victor office locations.

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Jan 27 2020 | Tyler Turkington Joins Allied Financial Partners Payroll Specialist

Allied Payroll Services, a division of Allied Financial Partners, is pleased to announce that Tyler Turkington has joined the firm as Payroll Specialist.

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Jan 22 2020 | Jason Brewer Joins Allied Financial Partners

The partners of Allied Financial Partners are pleased to announce that Jason Brewer has joined the firm as IT Help Desk Specialist.

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Jan 08 2020 | White Spruce Office Moved to 150 State Street, Rochester NY 14614

We are excited to have officially made the move into our new Rochester office!

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Dec 08 2019 | Tonawanda-Based CPA Firm Amato, Fox & Company Merges with Allied Financial Partners

Tette, Ingersoll & Co. CPAs, PC, a division of Allied Financial Partners, is pleased to announce its merger with the Tonawanda-based CPA firm, Amato, Fox & Company, PC, in order to grow its services and capabilities.

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Dec 03 2019 | Important: Holiday Payroll Hours Reporting Announcement

The week of December 23rd, ALL payrolls must be submitted no later than 11am on Tuesday, December 24th!

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