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Recent Blog Posts

  • CARES Act provides temporary fringe benefit for employer repayments of employee student loans By Greg Daugherty and Victoria Hanohano-Hong    The Coronavirus Aid, Relief and Economic Security (CARES) Act has provided a wide range of programs that affect employee benefit plans, employers and employees. One benefit that has flown under the radar is a new, temporary tax-qualified student loan repayment plan. Section 2206 of the CARES Act allows employers to claim a tax deduction for repayments of employee student loans, and allows employees to exclude these payments from taxable income, in amounts up to $5,250... More
  • Stop and review COVID-19 distribution and loan forms carefully By Greg Daugherty, Deb Boiarsky, Victoria Hanohano-Hong and Rich Helmreich    The Coronavirus Aid, Relief and Economic Security (CARES) Act, authorizes employers to make changes to their qualified retirement plans to increase loan limits, delay loan repayments, and make distributions to plan participants experiencing certain COVID-19 related circumstances. Due to a lack of guidance from the IRS, there’s confusion among third-party administrators (TPAs) about how to administer these changes, resulting in potential issues with forms used by TPAs to approve these CARES... More
  • How to claim COVID-19 tax credits via payroll By Victoria Hanohano-Hong, Gerhard Schulte, Mark Snider and Dave Tumen    Employers may claim the Employee Retention Tax Credit and the tax credits available under the Families First Coronavirus Response Act (FFCRA) for relief during the COVID-19 pandemic. They do this first, by reducing the employer portion of Social Security taxes, and then, by reducing the employer’s payroll deposits in an amount equal to the refundable portion of the accrued credits, instead of depositing said amount with the IRS. The payroll taxes an employer... More
  • Important update on the Payroll Protection Program By Cassandra Rice    Since the passage of the Coronavirus Aid, Relief and Economic Security Act (CARES Act), the Small Business Administration (SBA) and the U.S. Treasury Department have released a series of interim final rules and updated Frequently Asked Questions (FAQs) (as of April 8, 2020) regarding Paycheck Protection Program (PPP). These updates provide critical guidance and information to borrowers and lenders alike in the implementation of the highly sought after program. This blog describes some of the key clarifications to... More
  • UPDATE: SBA loan eligibility FAQs By Jack Meadows    Certain government programs, including SBA loan programs, are reserved for “small businesses.” In order to qualify for those programs, a business must satisfy both the SBA’s definition of a “small business concern” as well as the size standards for a small business. What is a small business concern? 13 C.F.R. § 121.105(a)(1) provides that “a business concern eligible for assistance from SBA as a small business is a business entity organized for profit, with a place of business located in... More
  • Workplace exposure to COVID-19: Can employers be liable? By Rich Helmreich    As COVID-19 cases continue to mount nationwide, so have lawsuits relating to fallout from the virus. On April 6, 2020, in one of the first COVID-19-related lawsuits of its kind, the estate of an Illinois Walmart Supercenter employee sued Walmart and the premises owner for wrongful death in Toney Evans v. Walmart, Inc., et al. My colleague Brodie Butland details the lawsuit in this Employer Law Report blog.... More
  • The Employee Retention Tax Credit By Victoria Hanohano-Hong    On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act (CARES Act) was signed into law. The CARES Act introduced the Employee Retention Tax Credit (ERTC), a new tax credit to incentivize employers, who are economically distressed due to COVID-19, to retain employees. The credit The ERTC provides a 50% tax credit on qualified wages paid to employees. For every dollar of qualified wages paid to an employee, the employer can claim a credit of 50 cents. There... More
  • How to claim COVID-19 tax credits under the FFCRA and the CARES Act By Victoria Hanohano-Hong    There are three COVID-19 related tax credits that were introduced under the Families First Coronavirus Response Act (FFCRA) and the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), which are subject to various limitations: Emergency Paid Sick Leave Act tax credits – a dollar-for-dollar tax credit for qualifying wage payments of emergency paid sick leave; Emergency Family and Medical Leave Expansion Act tax credits – a dollar-for-dollar tax credit for qualifying wage payments of family leave; and The Employee Retention... More
  • UPDATE: Tax credits available under the Families First Coronavirus Response Act By Victoria Hanohano-Hong    On March 18, 2020, the Families First Coronavirus Response Act (FFCRA) was signed into law requiring employers with fewer than 500 employees to make payments for COVID-19 related FLMA leave and paid sick leave required by the Act. To lessen this financial burden to employers, the act provides for refundable tax credits to offset payroll taxes. The FFCRA tax credits will be provided for eligible wages paid from April 1, 2020, to December 31, 2020. Paid sick leave tax... More
  • How ESOP sponsors can survive the disruption from COVID-19 By Greg Daugherty and Deb Boiarsky    The spread of COVID-19 and the resulting disruption to the economy has led many employers to think creatively about how to manage cash, provide for the sustainability of their businesses and preserve the culture they have created with their employees and customers. These issues are especially critical for employee stock ownership plan (ESOP) companies, many of whom are in the process of their annual appraisal. These appraisals are important because they directly affect the size... More