In 2020 we saw the introduction of various forms of Covid-19 relief for taxpayers and businesses alike. These programs continue to 2021 and beyond, with the Paycheck Protection Program (PPP) forgiveness and employer tax credits.
While the PPP has ended and no longer accepting new applications, many financial institutions have opened their PPP loan forgiveness portals and are reaching out to borrowers encouraging them to apply for forgiveness. We specialize in preparation of the first-draw and second-draw PPP forgiveness applications to optimize the amount of qualified expenses forgivable.
Businesses that received PPP loans, or have already applied for forgiveness, can take advantage of other Covid-19 benefits like the Employee Retention Tax Credit. This credit is available to employers who suffered a decrease in income in 2020 and 2021, yet continued to employ their workers. The amount of credit available is variable up to $5,000 per employee in 2020 and $28,000 per employee in 2021.
Now is the time to take a deep dive into the forensics of PPP loan forgiveness and the interplay with employer tax credits and the increased likelihood of an SBA or IRS audit. Other available employer tax credits include the Credit for Sick and Family Leave and the Paid Leave Credit for Vaccines.