March 31, 2020

Small Business Relief Information, CARES ACT

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The Coronavirus Aid, Relief, and Economic Security (CARES) Act that was signed by the President on Friday includes several important benefits for small businesses and nonprofits in Connecticut, including:

Paycheck Protection Program (PPP) Loans: Provides cash-flow assistance through federally-guaranteed loans with incentives for employers to maintain their payroll during this emergency. If employers maintain their payroll, they may be eligible to have a portion of their loan forgiven.
Economic Injury Disaster Emergency Grants: An emergency advance of up to $10,000 to small businesses and private nonprofits harmed by COVID-19 within three days of applying for an SBA Economic Injury Disaster Loan (EIDL). Grants and loans may be used to keep employees on payroll, pay for sick leave, meet increased production costs due to supply chain disruptions, or pay business obligations, including debts, rent and mortgage payments.
Small Business Debt Relief Program: Provides immediate relief to small businesses with non-disaster SBA loans, in particular 7(a), 504, and microloans. Under this program, the SBA will cover all loan payments on eligible SBA loans, not including the PPP loans described above, including principal, interest, and fees, for six months.
Employee Retention Credit for Employers Subject to Closure or Experiencing Economic Hardship: A refundable payroll tax credit for 50% of wages paid by eligible employers to certain employees during the COVID-19 crisis.
Delay of Payment of Employer Payroll Taxes: Allows taxpayers to defer paying the employer portion of certain payroll taxes through the end of 2020, with all 2020 deferred amounts due in two equal installments, one at the end of 2021, the other at the end of 2022.
Counseling and Training: Local resource partners can be found here .

For more details on the CARES Act visit Connecticut’s COVID-19 Business Resource Portal .

In addition to the above initiatives, employers should also be aware of the following programs:

Federal Emergency Paid Leave Program: Through the end of 2020, if certain criteria is met, employers with fewer than 500 employees must provide 80 hours of paid sick leave and 10 weeks of paid family leave . Note that employers will be reimbursed by the IRS for 100% of the paid leave in 2 weeks or less. They will also be reimbursed for employees’ health care premiums during leave. The current IRS guidance can be found here .
CT DOL’s Shared Work Program: Allows employers to reduce employees’ hours by up to 60% and DOL will step in to provide unemployment insurance (UI) benefits that help offset the lost wages, as well as the new federal UI supplement. More information about the program can be found here .

Many of these programs are also open to self-employed individuals. I encourage Connecticut businesses to act quickly to take advantage of the many resources being provided by the state and federal government during this crisis. Businesses should review these resources and reach out to lenders, landlords, and others as you consider making difficult decisions at this time.

DECD put together a quick-start guide that can be found here: https://portal.ct.gov/-/media/Coronavirus/20200327-Small-Business-Owners-Guide-to-the-CARES-Act.pdf?la=en

More information can be found at: https://www.uschamber.com/co/start/strategy/cares-act-small-business-guide

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Department of Revenue Services extends filing and payment deadlines for certain small businesses

At the direction of Governor Lamont to provide Connecticut small businesses with immediate administrative tax relief in recognition of the impact of COVID-19, the Department of Revenue Services (DRS) today announced that it granting a two-month extension of filing and payment deadlines for certain small businesses.

Taxpayers that have $150,000 or less in annual sales tax liability qualify for an automatic extension of time to file and pay. Similarly, those that have $150,000 or less in annual room occupancy tax also qualify for this relief. Entities that collect both sales tax and room occupancy tax must evaluate each tax separately to determine eligibility for relief.

Returns covered by this extension includes:

For monthly sales tax and room occupancy tax filers: Returns and payments due March 31, 2020, and April 30, 2020, are extended to May 31, 2020.
For quarterly sales tax and room occupancy tax filers: Returns and payments due April 30, 2020, are extended to May, 31, 2020.