The Essentials of the CARES Act for Your Business and Your Employees

By TEAM Software April 23, 2020 Categories: ,

Understand the CARES Act and how it applies to your janitorial or security company.

On March 27, 2020, the U.S. passed into law the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The bill funds various loans, grants, and other forms of assistance for businesses, industries, states, local governments, and hospitals. It’s designed to help small businesses with current expenses and financial needs

TEAM Software is dedicated to ensuring our software solutions meet the ever-changing needs of our customers. While we’re committed to keeping you informed, it’s important to do your own research and consult your own legal and tax advisors with specific questions or concerns. For more information on CARES, visit Congress.gov

Does my business qualify for the Paycheck Protection Program (PPP)?

This program provides no-fee business interruption loans for companies that employ under 500 people limited to payroll costs, continuation of group health care costs, employee salaries, sick leave and other permitted uses. Visit SBA.gov for additional information and to see if you qualify. A new round of PPP funding is expected to pass on April 23, 2020 that will add money to the program. Like the last round of funding, this money is expected to be exhausted quickly.

How much can I be reimbursed under the Employee Retention Credit?

The Employee Retention Credit is a refundable tax credit for up to 50% of qualified wages up to $10,000 per employee — meaning the employer could be reimbursed up to $5,000 per employee retained during this time. There are some other more nuanced restrictions with this as well. This credit does not have a 500 employee limit like other available provisions, but other restrictions do apply and can be found at IRS.gov. If you’re eligible, you can gain immediate access to the credit by reducing employment tax deposits by the amount you need to claim.

Can I defer my Social Security tax payments?

In addition to other payroll tax relief provisions, the CARES Act also includes a provision for all employers to defer Social Security tax payments made for their employees. Employers can defer payment of their share of the Social Security payroll tax on wages paid from March 27, 2020 through December 31, 2020. Repayment of 50% of the deferred tax is due by December 31, 2021, with the remaining 50% due by December 31, 2022.

Do I need to set up and offer hazard pay to my employees?

Some states are requiring hazard pay provisions for certain personnel. As a part of state, local, union, contract or potential future federal requirement, you may need to provide additional hazard pay to some employees. Although your security and janitorial company may not be legally compelled to offer hazard pay under CARES or other federal acts, many employers are choosing to do so or being requested to do so from their clients.

For TEAM customers, we’ve been actively working to find the best ways to handle the logistics of tracking and complying with the new law within WinTeam. To help you navigate the setup process, visit our COVID-19 toolkit on the TEAM Software Learning Center for additional resources.

Read the rest of the posts in our COVID-19 blog series: