Senators name to increase worker retention tax credit score
Senate Minority Chairman Charles Schumer (D-NY) (L) and Senate Majority Leader Mitch McConnell (R-KY) walk side by side to the Senate Chamber in the U.S. Capitol on February 7, 2018 in Washington, DC.
Chip Somodevilla | Getty Images
A non-partisan group of senators is calling on Senate Chairs to add a key economic exemption clause when the chamber adopts the $ 1.9 trillion coronavirus bailout next week.
Nine lawmakers wrote to Senate Majority Leader Chuck Schumer, DN.Y., and Minority Leader, Mitch McConnell, R-Ky., Friday urging them to remove the employee retention tax credit in the bill that runs through Congress to increase. First implemented under the CARES Act last spring, the directive aims to encourage companies to keep workers on payroll while the pandemic is damaging the economy.
Under the current structure, companies can claim refundable tax credits for 70% of eligible wages and health insurance costs up to $ 10,000 per employee per quarter. Employers now qualify through June if government health contracts limit their business in whole or in part, or if during a quarter they earn less than 80% of the income they made in the same period in 2019.
Senators wrote that they intend to change tax credit policy to remove a provision that would allow companies with more than 500 employees to request credit only for “compensation for workers on leave who are paid but not working.” Instead, they want companies that have lost at least 85% of their sales to use the credit for all employees regardless of their status.
“This rule severely limits the support that the ERTC can offer the most affected companies, for example in the live entertainment and performing arts industries,” the legislature wrote. “Additionally, due to the size of their workforce and the scope of their business operations, many companies in these industries were unable to access other forms of federal economic support during COVID-19.”
The letter was written by Sens. Maggie Hassan, DN.H., Jerry Moran, R-Kan., Catherine Cortez Masto, D-Nev., Kevin Cramer, RN.D., Kyrsten Sinema, D-Ariz., Raphael Warnock, signed D-Ga., Mark Warner, D-Va., Jacky Rosen, D-Nev. And Mark Kelly, D-Ariz.
Some pandemic economic aid programs, such as loans for futile paycheck protection programs, attempt (but not always) to provide relief to the smallest of businesses. In the meantime, the “Save our Stages” law, passed under the December bill, aims to support the smallest independent theaters and venues for live events.
Proponents of the plan said at the time the aid would not go to large multistate corporations like Ticketmaster owner Live Nation.
The House plans to adopt its version of the $ 1.9 trillion aid package on Friday. Democrats, who are expected to pass the legislation without a Republican ballot vote, want to get the bill to President Joe Biden’s desk before critical unemployment benefits expire on March 14.
The house bill would extend the tax credit for employee loyalty – without the change sought by the senators – until the end of the year.
Senators from across the ideological spectrum are expected to make a number of changes to the plan when it passes the Capitol next week. For example, Senator Bernie Sanders, I-Vt., Will attempt to make changes to tax policy to ensure companies pay a minimum wage of $ 15 an hour after Senate-ruled Democrats failed to include a raise in their legislation.
If the Senate makes changes to the House bill, the representatives must vote again on the auxiliary bills.
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