Eligible Employers Affected by COVID-19 Can Access Employee Retention Credit Under CARES Act
The Coronavirus Aid, Relief, and Economic Security (CARES) Act offers a provision for an employee retention credit for employers struggling to operate due to COVID-19. Eligible employers can take a credit against employment taxes for each calendar quarter in an amount equal to 50% of the qualified wages with respect to each employee for the calendar quarter. The total amount of qualified wages which may be taken with respect to any employee is $10,000.
Which employers qualify?
The CARES Act defines an “eligible employer” as an employer whose business was suspended due to an order from a governmental authority limiting commerce, travel, or group meetings due to COVID–19, or an employer that experiences a significant decline in gross receipts. Additionally:
- Eligible employers with 100 or fewer full-time employees can use the credit for all employee wages.
- Eligible employers with greater than 100 full-time employees, on the other hand, may only take the credit for wages paid to employees when they are not providing services due to a governmental order related to COVID-19.
If you are an employer with questions about this retention credit or any other COVID-19 related employment concern, please contact Tracy Armstrong, Ashley Morin or any member of the Wilentz Employment Law Team.
The postings on this blog were created for general informational purposes only and do not constitute legal advice or a solicitation to provide legal services. Although we attempt to ensure that the postings are complete, accurate, and current as of the time of publication, we assume no responsibility for their completeness, accuracy, or timeliness. The information in this blog is not intended to create, and receipt of it does not constitute, a lawyer-client relationship. Readers should not act upon this information without seeking professional legal counsel.
This blog may contain links to independent third party websites and services, including social media. We provide these links for your convenience, and you access them at your own risk. We have no control over and do not monitor the content or policies (including privacy policies) of these third-party websites and have no responsibility for, and no liability with respect to, their content, accuracy, or reliability. Unless expressly stated, we do not endorse any of the linked websites or any product, service, or publication referenced herein or therein. We will remove a link to any site from this blog upon request of the linked entity.
We grant permission to readers to link to this blog so long as this blog is not misrepresented. This site is not sponsored or associated with any other site unless so identified.
If you wish for Wilentz, Goldman & Spitzer, P.A., to consider representing you, please obtain contact information from the Contact Us area of this blog or go to the firm’s website at www.wilentz.com. One of our lawyers will be happy to discuss the possibility of representation with you. However, the authors of Wilentz blogs are licensed only in New Jersey and/or New York and do not wish to represent anyone who viewed this site in a state where the site fails to comply with all laws and ethical rules of that state.
Employer Alert: CDC Releases New Quarantine and Isolation Calculator
Employee Complaints About COVID-19 Safety Protocols are Triggering OSHA Investigations
Employment Law Update: New Jersey Executive Order to Require COVID-19 Vaccination & Booster for Workers in Certain Health Care Settings and Congregate Settings