NewsOctober 2, 2021by admin

House Passes The Health And Economic Recovery Omnibus Emergency Solution (HEROES) Act, H.R. 6800 On May 15, 2020

The HEROES Act would make significant changes to the Employee Retention Tax Credit including:

  • Increasing qualified wages to $15,000 per quarter for up to three quarters (maximum credible wages would be $45,000) up from the current $10,000;
  • Increasing the percent of the credit to 80% from the current 50% (this would make the maximum credit $12,000 per quarter or $36,000 over three quarters;
  • Codifying that the proportional amount of health care insurance paid for an employee by the employer during the period that the business was closed, operating at a reduced capacity, or who’s income is between 50% and 90% of what it was during the same quarter of the precious year is eligible for the ERTC regardless of whether the employee was paid wages;
  • Defining a large employer as having 1,500 full time equivalent employees as opposed to the HEROES Act which sets the threshold at 100 employees;
  • Modifying the revenue loss test for businesses not subject to a government shutdown order by phasing out the credit between a 50% and 90% loss of gross receipts. Currently there is no phase out – eligibility ends at the point that gross receipts exceed 50% for the same calendar quarter during the previous year;                                                   
  • Qualified wages would include tips deemed to be paid by the employer;
  • Allowing employers to qualify for both a Payroll Protection Program loan and the Employee Retention Credit, but not for the same wages.  Currently, employers cannot qualify for both.