Politicians in Washington have begun negotiations on the next round of COVID-19 stimulus. For business owners across the country, this will be a welcome relief and more. And with the prior stimulus measures expired, Congress will meet shortly to negotiate a new package.
#1. The PPP Will Likely Continue: The Paycheck Protection Program (PPP), the $669 billion forgivable loan program, might continue. Secondly, all PPP loans under $150,000 or $250,000 could be automatically forgiven.
#2. Local Communities Will Get A Boost: Low-income areas, as well as minority-owned businesses, might receive $50 billion to support small business local relief funds. The Cares Act initially provided $150 billion in federal aid to state and local governments across the country, some of which went toward grant funding for local businesses.
#3. More Tax Relief: Currently, PPP monies aren’t counted as taxable income. Because of that, the IRS ruled that a business wasn’t able to deduct traditional business expenses paid by PPP funds (if the loan was forgiven). A new bill, the Small Business Expense Protection Act, was introduced that would allow a business to take these deductions.
Additionally, another bill was introduced in May, JOBS Credit Act. The proposed JOBS Credit Act would make the following changes to the CARES Act employee retention credits:
The credits currently equal 50% of up to $10,000 in qualified wages that an eligible employer pays in a calendar quarter. The JOBS Credit Act would increase the amount of the credits to 80% of up to $15,000 in qualified wages per calendar quarter with a new annual cap of $45,000 in qualified wages. The maximum credit for wages paid to any employee would, therefore, increase from $5,000 under the CARES Act to $36,000 under the increased limits of the JOBS Credit Act.
Click Here To Read About The JOBS Credit Act.
#4. Stimulus Checks Sent To Individuals: The Heroes Act passed by the House supports another round of stimulus checks that the Cares Act authorized in March for millions of taxpayers:
Individuals earning under $75,000 would get $1,200.
Married couples with less than $150,000 in adjusted gross income would get $2,400.
An additional $1,200 for up to three dependents, regardless of age.
#5. Unemployment Benefits: The Cares Act’s enhanced unemployment insurance, which offered an additional $600 per week, expired in July. To avoid the issue of employees not wanting to come back to work, many lawmakers are considering a varied dollar value to better coordinate with a state’s unemployment insurance level (replace 80% to 90% of a worker’s former wages, up to a maximum federal benefit of an additional $400 per week).
#6. $1,500 Return To Work Bonus: The Paycheck Recovery Act, proposed in mid-May, offers someone who makes less than $40,100 annually, a $1,500 rehiring bonus upon return to work.
#7. Greater Liability Protection: Certain lawmakers want to see greater liability protection for employers. Although the details are unclear, the Phase 4 bill will allow for some form of safe harbor for companies that make a good-faith effort to follow public-health guidelines.