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1 1 (March 31, 2020)

handle is hein.crs/govctyv0001 and id is 1 raw text is: Researh Sevice COVID-19: The Employee Retention Tax Credit March 31, 2020 The Coronavirus Aid, Relief, and Economic Security (CARES) Act (P.L. 116-136) includes an employee retention payroll tax credit intended to help businesses retain employees during the Coronavirus disease 2019, or COVID-19, public health emergency. Employee retention remains a policy concern, as a number of economic sectors have announced layoffs resulting from the COVID-19 induced economic fallout. Uneinploynent insurance claims have surged following these widespread layoffs. This Insight summarizes the employee retention tax credit in the CARES Act, makes comparisons to previous employee retention tax credits enacted as disaster tax relief, and highlights some economic and policy considerations. The Employee Retention Tax Credit The employee retention tax credit (ER717C) allows eligible employers to claim a payroll tax credit of up to $5,000 per employee for qualified wages paid while closed or having reduced operations due to COVID- 19. The credit is computed as 50% of up to $10,000 in qualified wages paid to an eligible employee. (Eligible employees are generally those who have been employed by the employer for at least 30 days.) Health plan expenses can be treated as qualified wages when computing the credit. The credit can be taken for wages paid after March 12, 2020, and before January 1, 2021. Eligible employers are those who (1) are required to fully or partially suspend operations due to a COVID-19-related order (including nonprofit employers); or (2) have gross receipts 50% less than gross receipts in the same quarter in the prior calendar year (with the credit no longer being available once gross receipts are 80% of prior year calendar quarter gross receipts). Congressional Research Service https://crsreports.congress.gov IN11299 CRS NStGHT Prepaimed for Mernhe-s amd Committees 4 o C- --q.. . . . . . . . . . ..-----------------------------------------------------------------------------------------------------------------------------------------------------------------------

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