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Paychex has put together an updated eBook to bring you the latest updates on the PPP with loan forgiveness. 

Loans can be up to 2.5 times your average monthly payroll costs, not to exceed $10 million.

To calculate payroll costs:

sum of INCLUDED payroll costs - sum of EXCLUDED payroll costs = payroll costs

Included Payroll Costs:

The sum of payments of any compensation with
respect to employees that is a:

• salary, wage, commission, or similar compensation;
• payment of cash tip or equivalent;
• payment for vacation, parental, family, medical, or sick leave;
• allowance for dismissal or separation
• payment required for the provisions of group health care benefits, including insurance premiums
• payment of any retirement benefit
• payment of state or local tax assessed on the compensation of the employee

Excluded Payroll Costs

1. Compensation of an individual employee in excess of an annual salary of $100,000, as prorated for the period February 15, to June 30, 2020
2. Payroll taxes, railroad retirement taxes, and income taxes
3. Any compensation of an employee whose principal place of residence is outside of the United States
4. Qualified sick leave wages for which a credit is allowed under section 7001 of the Families First Coronavirus Response Act (Public Law 116–5 127); or qualified family leave wages for which a credit is allowed under section 7003 of the Families First Coronavirus Response Act

How could the forgiveness be reduced?
The amount of loan forgiveness calculated above is reduced if there is a reduction in the number of employees or a reduction of greater than 25% in wages paid to employees.

What if I bring back employees or restore wages?
Reductions in employment or wages that occur during the period beginning on February 15, 2020, and ending 30 days after enactment of the CARES Act, (as compared to February 15, 2020) shall not reduce the amount of loan forgiveness IF by June 30, 2020 the borrower eliminates the reduction in employees or reduction in wages.

Once your PPP loan closes, your eight-week period for loan forgiveness begins immediately. To maximize forgiveness eligibility, you need to get people back on payroll quickly. Click here to see how the process works:

https://www.paychex.com/support/loan-forgiveness

Whether you have recently received your Small Business Administration loan through the Paycheck Protection Program (PPP), or are hoping to apply in the future, how much of your loan may be forgivable by the federal government is based on many factors. Our friends at Paychex have created a Loan Forgiveness Estimator to assist you with understanding what part of your loan may be forgiven.

To calculate your estimated loan forgiveness, please visit https://www.advancepartners.com/ppp-loan-forgiveness-estimator

Here’s what we know as of Monday, March 30, 2020:

• The effective date for the FFCRA is Wednesday, April 1, 2020.
• The leave provisions of the FFCRA generally apply to all private employers with fewer than 500 employees.
• Eligible employees with a qualifying need related to the COVID-19 public health pandemic as specified in the FFCRA will be entitled to paid leave as of April 1, 2020.
• Each covered employer must post a notice of the FFCRA requirements in a conspicuous place on its premises.   
• Covered employers will be entitled to tax credits in the specified amount under the law for the benefits paid to eligible employees for qualified leave taken under the Emergency Paid Sick Leave Act and the Emergency Family and Medical Leave Expansion Act between April 1, 2020, and December 31, 2020.

• Private employers with fewer than 500 employees (instead of employers with 50 or more employees) must provide up to 12 weeks of job-protected public health emergency leave, ten weeks of which must be paid leave, to their employees through December 31, 2020.
• Only applies when employee is unable to work or telework due to caring for child under 18 if the child's school is closed or the child's regular childcare provider is unavailable due to the public health emergency.
• Employees eligible after 30 days of employment
• Daily pay cannot exceed $200 per day, and in the aggregate, paid leave under this Section is not to exceed $10,000.00 per employee.  Part-time employees are also eligible for paid leave, but it is calculated based on the average number of hours worked during the previous six months before taking leave, or if the employee has not worked during the prior six months, based on the reasonable expectation that the employee had at the time of hire regarding his or her expected hours of work.

Under the Emergency Paid Sick Leave Act, employers would be required to provide sick time, available for immediate use, to each employee who requires such time for qualifying reasons associated with COVID-19.

Employers also must provide up to 80 hours of paid sick leave (PSL) to eligible full-time employees and pro-rate part-time employee paid sick time based on the average number of hours regularly scheduled in a two-week period. The calculation and caps for compensation vary dependent on the reason for leave up to the maximum $511 per day if the employee is directly impacted and up to $200 per day if it is for care provided to someone else. Aggregate caps exist as well.

Congress is trying to make sure that payment of family and sick leave come at no net cost to employers.

To achieve this, an employer required to pay family or sick leave is allowed to claim a credit against the employer's 6.2% share of the Social Security taxes paid on all wages. Any credit in excess of this amount is fully refundable. 

To speed along the process, the IRS issued Form 7200 to:

1. Offset the family, sick, and employee retention credits against not only the employer’s share of Social Security taxes on a payroll tax return, but also federal income tax withholding and the full amount of the employer’s and employee’s share of payroll taxes, and
2. Receive an immediate benefit equal to the anticipated credits by reducing the amount of the required payroll deposits by the computed credits.

You can download the instructions for the form HERE

Download the actual form HERE.

The CARES Act is a financial stimulus package designed to help small businesses get a loan of up to $10 million to stay afloat to help offset the financial challenges created by the COVID-19 pandemic. Additional benefits provided through the Paycheck Protection Program (PPP) incentivize you to avoid layoffs.

Yes! A key piece of the largest relief bill in recent memory is the more than $370 billion in funding for small businesses, including staffing firms who meet eligibility requirements. Businesses with fewer than 500 employees are eligible for up to $10 million in loans, which can be used for payroll and other expenses, such as insurance premiums, mortgage interest, rent or utilities.

The loans, available at financial institutions currently extending SBA loans and other non-traditional lenders, would be completely forgiven if the employer continues to keep the employees or hires back those who already have been laid off, and uses the funds for covered expenses.

You are eligible if you are:
• A small business with fewer than 500 employees
• A small business that otherwise meets the SBA’s size standard
• A 501(c)(3) with fewer than 500 employees
• An individual who operates as a sole proprietor
• An individual who operates as an independent contractor
• An individual who is self-employed who regularly carries on any
trade or business
• A Tribal business concern that meets the SBA size standard
• A 501(c)(19) Veterans Organization that meets the SBA size standard

In addition, some special rules may make you eligible:
• If you are in the accommodation and food services sector (NAICS 72),
the 500-employee rule is applied on a per physical location basis
• If you are operating as a franchise or receive financial assistance
from an approved Small Business Investment Company the normal
affiliation rules do not apply

REMEMBER: The 500-employee threshold includes all employees: full time, part time, and any other status.

In evaluating eligibility, lenders are directed to consider whether the borrower was in operation before February 15, 2020 and had employees for whom they paid salaries and payroll taxes or paid independent contractors.

Lenders will also ask you for a good faith certification that:
1. The uncertainty of current economic conditions makes the loan request necessary to support ongoing operations
2. The borrower will use the loan proceeds to retain workers and maintain payroll or make mortgage, lease, and utility payments
3. Borrower does not have an application pending for a loan duplicative of the purpose and amounts applied for here
4. From Feb. 15, 2020 to Dec. 31, 2020, the borrower has not received a loan duplicative of the purpose and amounts applied for here (Note: There is an opportunity to fold emergency loans made between Jan. 31, 2020 and the date this loan program becomes available into a new loan) If you are an independent contractor, sole proprietor, or self-employed individual, lenders will also be looking for certain documents (final requirements will be announced by the government) such as
payroll tax filings, Forms 1099-MISC, and income and expenses from the sole proprietorship.

Assistance from the CARES Act is not dependent on:

• Whether you sought and were unable to obtain credit elsewhere.
• You providing a personal guarantee.
• You putting up any collateral.

What is it?

The Employee Retention Credit is a fully refundable tax credit for employers equal to 50 percent of qualified wages (including allocable qualified health plan expenses) that Eligible Employers pay their employees. This Employee Retention Credit applies to qualified wages paid after March 12, 2020, and before January 1, 2021. The maximum amount of qualified wages taken into account with respect to each employee for all calendar quarters is $10,000, so that the maximum credit for an Eligible Employer for qualified wages paid to any employee is $5,000.

More information on eligibility and other FAQ's on this can be found here:

https://www.irs.gov/newsroom/faqs-employee-retention-credit-under-the-cares-act

Our partner, HIREtech, has created an online COVID-19 Tax Credit Analyzer. If you are interested in seeing how much you will be credited, that resource can be found here: https://covid19.hiretech.com/?utm_source=active_campaign&utm_medium=email&utm_campaign=covid19_tax_analyzer

Absolutely! Advance Partners is open for business.

For your health and safety, as well as that of our employees, the majority of our team members are now working from home, with only about 10 deemed essential who still go into the office.

We have gone to great strides to ensure none of our services have been interrupted and that it's business as usual. 

In addition, you'll never have to turn down an opportunity due to lack of working capital while partnered with us. Because we're backed by Fortune 1000 company, Paychex, we can provide unlimited funding without restricting our credit requirements, regardless of the economic state.

Absolutely not. Because of our extensive preparedness plans, our teams were able to leap into action as soon as we saw that we may have to begin setting up offsite operations.

As a result of that preparedness and execution, all our services are humming along as they were and we don't expect any interruption of service.

No. We're still able to offer our entire range of back office support, including invoicing, payroll tax administration, custom reporting, and software solutions.

Because we provide funding, including to some staffing firms who provide essential functions, we are considered an essential business. We are committed to being there for you and will make necessary accommodations so that we can provide service to you and your employees while still following government regulations.

Listen to Episodes 1-10 now!
https://www.paychex.com/worx/podcasts/business-podcast

Understanding the CARES Act and its Business Impact
Friday, April 3, 2020
Host: Paychex
Link here to watch: https://www.paychex.com/secure/seminars/understanding-cares-act?utm_medium=email&utm_campaign=435136&utm_source=marketo&utm_content=default&campaign_id=&os_ehash=50@marketo:A7NVZ94&lift=A7NVZ94&mkt_tok=eyJpIjoiTVdVNFlUTTBOVFEzWm1VNCIsInQiOiJPTWtUZE9xQVVhakdWOFNaODVoWDBMNTVISThzRStsR2ZyQmE5WVYzREVndTFmaWpXSitHQ3pDdnIySGlYWjdJQmcrTzdUeGtjU2FRcjBJY1dNbjZPVEpwWnV5Um5hODdLMDdTZkRPMFIzVnZWSTNINlJFXC82THhkelkzc1NLK0QifQ%3D%3D

The CARES Act- Overview for Staffing Firms
Wednesday, April 1, 2020
Host: American Staffing Association
Link here to watch the webinar: https://americanstaffing.net/webinars/the-cares-act-overview-and-ramifications-for-staffing-firms/

The coronavirus pandemic will end, but it won't be overnight. It will take a concerted and sustained effort from federal, state, and local governments, as well as its citizens to ensure that people are and feel safe and more at ease.
Make sure you are made aware of all the potential changes for your workers.
https://www.paychex.com/articles/human-resources/after-the-pandemic-whats-next-for-employees

What can I do to protect my employees and business?

The CDC recommends simple, everyday preventative actions to help curb the spread of respiratory viruses.

• Avoid close contact with people who are sick
• Avoid touching your eyes, nose, and mouth with unwashed hands
• Wash your hands often with soap and water for at least 20 seconds. If soap and water aren't available, use an alcohol-based hand sanitizer containing at least 60 percent alcohol.

Additionally, experts suggest:

• Meeting virtually with clients and co-workers
• Avoiding large work gatherings such as conferences
• Limiting travel, especially non-essential business travel
• Reviewing or developing your company's business continuity plan   

When should I – or my employees – stay home?

If you have symptoms of acute respiratory illness (fever, coughing, shortness of breath), the CDC recommends you stay home until you are free of fever, signs of a fever, and any other symptoms for at least 24 hours without the use of fever-reducing or cough suppressant medication.

What if one of my employees is returning from international travel? Should I tell them to stay home?

If an employee is returning from international travel to an area with widespread sustained transmission of COVID-19, as confirmed by the CDC (as of March 4, 2020, that’s China, Japan, Italy, Iran, and South Korea), consider the most current recommendations found on the CDC website.

What if one of my employees becomes sick or is quarantined?

Employers should reference their established paid sick leave policies as well as federal, state and local paid leave laws where applicable.  Employers should also be aware of federal and state disability leave laws. Keep in mind that they may be quarantined and not diagnosed with the virus. In such cases, paid time off or sick policies may not be implicated.

Many states have created specific online resources for COVID-19 to provide updates and guidance to residents. Click the link to find your state.

What you should consider when recalling employees from furlough/ temporary lay-off, or rehiring after termination.

Paychex has put together a very useful checklist to help answer these questions: https://www.paychex.com/sites/default/files/2020-04/coronavirus_return_work_checklist_041520.pdf