Written Monday, Dec. 28, 2020, at 6:30 AM
After veiled veto threats, expiration of extended unemployment benefits and a cliffhanger government shutdown showdown, the Consolidated Appropriation Act, 2021, is now the law.
Late Sunday night, December 27, President Trump signed into law the 32 Divisions(!) of the mammoth Act, including Divisions N and EE which contain the following:
| Name | Main Payroll Provisions |
| The COVID-related Tax Relief Act of 2020 | Extension of FFCRA payroll tax credits |
| The Economic Aid to Hard-Hit Small Businesses, Nonprofits and Venues Act | Extension and expansion of the Paycheck Protection Program (PPP) |
| The Taxpayer Certainty and Disaster Tax Relief Act of 2020 | Extension and expansion of the Employee Retention Credit (ERC) |
So, what do these new laws mean for you and your business?
The Basics
This law is the second-largest relief package to date, following the $2 trillion CARES Act passed on March 25, 2020.
The full Appropriations Act, also known as the Federal budget, is 5,593 pages long, with COVID-19 relief running through Divisions M, N, and EE. Before you settle down for an all-nighter, though, note that payroll-related provisions dwell in the specific Acts listed above. We’re not going to discuss non-payroll items, such as the much-touted direct stimulus payment of $600 per taxpayer, extended unemployment, and rental assistance. Let’s turn our attention to what employers need to know.
Families First Coronavirus Response Act (FFCRA) Credit Extension
The Old: Before the new law, payroll tax credits available for FFCRA-mandated paid leave were set to expire on December 31, 2020. For more information about this leave and the credits, check out our blog.
The New: Section 286 of the COVID-related Tax Relief Act of 2020 extends the availability of these credits until March 31, 2021. Notably, there is no extension of the requirement to pay this leave. The new law is just incentivizing employers to voluntarily continue paying the same type of leave previously required by offering the same credits as before.
The Doubts: Prior to this new law, FFCRA payroll tax credits were limited per employee as follows:
Sick leave for self-care: Up to $5,110
Sick leave for other care: Up to $2,000
Family leave for childcare: Up to $10,000
But here’s the catch – those limits were for calendar year 2020. Do the credits newly available in the first quarter of 2021 zero out those limit counters and start again? Or are limit calculations cumulative? Software systems, historically structured around calendar years, would have to do a few backward cartwheels to accommodate tax credit limits that stretch across years. And those cartwheels would have to be executed this week, as the new credits apply to paid leave starting this Friday, January 1, 2021.
The way the law is written, it seems that the limits would be cumulative. But at this early point, we can only look to the Department of Treasury to issue swift guidance.
PPP Loan Expansion
Second Draw
The Old: The CARES Act tasked the Small Business Administration (SBA) with administering forgivable Paycheck Protection Program (PPP) loans, generally for businesses with 500 or fewer employees affected by COVID-19. The loan application process closed on August 8, 2020.
The New: The Economic Aid to Hard-Hit Small Businesses, Nonprofits and Venues Act provides nearly $285 billion for a new round of loans for employers with 300 or fewer employees per location who can ALSO show that quarterly gross receipts for any quarter of 2020 dropped at least 25% compared to the corresponding quarter of 2019. In addition, no single loan can exceed $2 million. Businesses that have already received a loan and meet the above requirements can apply for a second loan, though borrowers must use the full loan before disbursement. In addition, $35 billion is set aside for first-time borrowers and $12 billion is set aside for minority-owned businesses.
Under the new law, loan applications must be filed by March 31, 2021.
The Doubts: When will loan applications be accepted? What documentation will be required for establishing a decrease in revenues? What documentation will be required for establishing that first draw loan funds have been exhausted?
Expanded Expenses
The Old: Non-payroll costs eligible for forgiveness were limited to mortgage interest, rent, and utilities, and could only constitute up to 40% of the forgiveness amount.
The New: The Economic Aid to Hard-Hit Small Businesses, Nonprofits and Venues Act expands eligible non-payroll credits to include:
This expansion may enable employers to request increases in their loan amount (not treated as a second draw loan). However, the total of all non-payroll expenses STILL can’t exceed 40% of forgiveness amount.
The Doubts: This expanded definition of non-payroll expenses applies to first-round loans as well, provided a forgiveness application has not yet been submitted. But what if an employer applied for forgiveness and was rejected – can they resubmit their application under the new rules if those rules will now qualify them for forgiveness? If a borrower requested a second draw loan, can they still go back and request an increase in their first draw loan based on the expansion of qualified expenses?
Extended Safe Harbor
The Old: Under the CARES Act, a safe harbor from forgiveness reduction applies if wage/FTE reductions between February 15 and April 26, 2020, were restored by a payroll comparison date to be chosen by the employer and which could be no later than December 31, 2020.
The New: The payroll comparison date can now be no later than September 30, 2021.
Flexibility of Covered Period
The Old: Borrowers who received loans prior to the Paycheck Protection Program Flexibility Act (PPPFA) passed on June 5, 2020, were able to choose an 8-week or 24-week covered period. Borrowers after the PPPFA had to use 24 weeks as their covered period.
The New: Borrowers receiving second-round loans, or those with first-round loans who did not yet apply for forgiveness can choose any ending date for their covered period that is between 8 and 24 weeks from the date of their first loan disbursement. However, the covered period must end by September 30, 2021.
The Doubts: This flexible definition of covered period applies to first-round loans as well, provided a forgiveness application has not yet been submitted. But what if an employer applied for forgiveness and was rejected – can they resubmit their application under a different period if that new period will now qualify them for forgiveness?
Expansion of Simplified Forgiveness
The Old: Loans of less than $50,000 were eligible for a simplified forgiveness process (Form 3508S), under a de minimus process. For these loans, full forgiveness was available even if there had been wage or FTE reductions. However, if the employer was part of an affiliated group which borrowed in total more than $2 million, the simplified process was not available.
The New: Loans of less than $150,000 will be eligible for the simplified process. In addition, loans between $150,000 and $2 million will not require submission of documentation, only certifications and record retention.
The Doubts: Will the $2 million affiliated group rule still apply to less than $150,000? Will the $150,000 simplified process mirror the $50,000 rules such that wage and FTE reductions will be disregarded?
Deductibility of Expenses
The Old: Since its inception, the deductibility of PPP expenses for income tax purposes has probably been the biggest PPP controversy. Proponents of deductibility claimed that this was Congress’s intention, inadvertently omitted from the CARES Act, while opponents claimed that allowing a corporate tax deduction for expenses paid with a Federal grant would be egregious double-dipping. The IRS held its ground, insisting that expenses claimed for PPP would not be deductible for corporate tax purposes.
The New: The Economic Aid to Hard-Hit Small Businesses, Nonprofits and Venues Act grants full deductibility of PPP expenses.
The Doubts: Well, this one’s pretty clear and welcome news to struggling businesses.
PPP and ERC Coordination
The Old: Employers who receive a PPP loan were excluded from claiming the Employee Retention Credit created by the CARES Act.
The New: The new law allows employers to claim the ERC even if they’ve received a PPP loan. That’s big news and can translate into thousands of dollars of newly found credits. Caveat though– any wages for which retention credits are claimed are not qualified PPP Payroll Costs for forgiveness. Fair enough.
The Doubts: Will employers need to go back and amend prior quarters to claim those employee retention credits? A special rule buried in Division EE charges the Treasury with creating a mechanism for avoiding amendments. What will that mechanism be? Will it be ready fast enough to avoid fourth quarter amendments?
Extension and Expansion of the Employee Retention Credit
The Old: ERC was set to expire on December 31, 2020. It provided a payroll tax credit of 50% of qualified wages paid up to $10,000 per employee for 2020.
The New: The Taxpayer Certainty and Disaster Tax Relief Act of 2020 extends the credit through June 30, 2021. In addition, for the first and second quarters of 2021, the credit is 70% of wages paid up to $10,000 per employee PER QUARTER, not per year. That’s a big increase in credits.
The Doubts: Again, this one is pretty clear.
Extension of Employee Social Security Deferral Repayments
The Old: President Trump’s Executive Memorandum signed on August 8, 2020, allowed employers to allow their employees the option of deferring their social security tax contributions for the last four months of 2020 (September through December). The deferred taxes would be withheld “ratably” during the first four months of 2020 (January through April).
The New: The deferred taxes can now be withheld over the entire 2021, reducing the amount of employee deductions on each payroll. At the same time, employees can opt to have their deferrals withheld at a faster rate.
The Doubts: IRS guidance provided that a Form W-2c for 2020 would be necessary upon completion of withholding. Will deferrals paid through December 31, 2021, still necessitate only a 2020 W-2c, or will a 2021 W-2c be required as well? And what mechanism will the IRS put in place to avoid issuing late deposit penalty notices for the 2021 deposits of 2020 liabilities?
We are awaiting further clarity with the release of both IRS and SBA guidance, Be sure to check this space frequently for continuing Viventium coverage and updates.
This information is for educational purposes only, and not to provide specific legal advice. This may not reflect the most recent developments in the law and may not be applicable to a particular situation or jurisdiction.
Viventium Software Inc. is a SaaS-based human capital management solution that provides a remarkable user experience and award- winning software. Viventium provides flexible software and expert guidance so clients can be sure their payroll is done right.
Viventium offers specialized solutions in the health services markets which include home care agencies and skilled nursing facilities. Viventium Software supports all fifty of the United States with payroll and HR solutions.
Relax – you’re with Viventium.
©2024 Viventium Software, Inc. All rights reserved. | Privacy Policy | Terms & Conditions | Legal | 
Licenses: Viventium HCM LLC NMLS ID: 2094503
Overtime, oh, it’s a complicated game, Different rules in every state, it’s never the same, Multiply by 1.5, but there’s more to see, In this overtime equation, it’s not that easy, you see.
VERSE 1
In the world of work, there’s a tale to be told, About overtime hours, and the payroll gold, A consistent paycheck, that’s the worker’s dream, But when it comes to overtime, it’s not as easy as it seems.
PRE-CHORUS
Oh, Susie worked hard in San Francisco town, But the rules around overtime, they had her feeling down, 42 hours this week, she gave her all, Now it’s time to calculate, let the numbers fall.
CHORUS
Overtime, oh, it’s a complicated game, Different rules in every state, it’s never the same, Multiply by 1.5, but there’s more to see, In this overtime equation, it’s not that easy, you see.
VERSE 2
Exempt or non-exempt, the title they hold, Where they work, where you’re based, it’s all in the fold, California or New York, the laws they diverge, For payroll admins, it’s a never-ending surge.
PRE-CHORUS
Oh, the DOL’s website, a labyrinth to explore, State regulations galore, it’s quite a chore, Staying compliant, it’s a tricky art, Missing out on requirements can break your heart.
CHORUS
Overtime, oh, it’s a complicated game, Different rules in every state, it’s never the same, Multiply by 1.5, but there’s more to see, In this overtime equation, it’s not that easy, you see.
BRIDGE
But here’s a method that can save the day, A payroll software, to keep errors at bay, Input the info right, integrate with ease, No more manual labor, no more overtime fees.
VERSE 3
Back to Susie’s story, she’s owed her due, According to FLSA, it seems we have a clue, $860 on the table, that’s what we’d say, But California’s got its rules, changing the way.
PRE-CHORUS
Oh, California says, hours past eight, Are overtime-eligible, don’t underestimate, Now Susie’s owed $900, that’s the decree, In this overtime puzzle, you gotta set it free.
CHORUS
Overtime, oh, it’s a complicated game, Different rules in every state, it’s never the same, Multiply by 1.5, but there’s more to see, In this overtime equation, it’s not that easy, you see.
OUTRO
So when it’s overtime, and the rules entwine, Choose a payroll software, let it all align, Viventium’s the name, we’ve got the key, To make overtime calculations a breeze, you’ll see.
ENDING
Don’t overwork yourself, don’t you fret, With Viventium by your side, it’s a safe bet, Relax, you’re with us, in this overtime fight, With the right tools in hand, everything’s gonna be alright.
Take back time, like a winding clock, Retroactive pay, mending every block. Calculate the hours, with precision and grace, In the world of care, in this payroll space.
VERSE 1
In the world of care, where time slips away, Caregivers dedicate, every single day. But when the hours are missed, in the daily race, Retroactive pay, steps up to embrace.
PRE-CHORUS
A caregiver tired, at the week’s end, Forgot to log hours, a mistake to mend. Admins face the challenge, calculations to make, To set it right, for the caregiver’s sake.
CHORUS
Take back time, like a winding clock, Retroactive pay, mending every block. Calculate the hours, with precision and grace, In the world of care, in this payroll space.
VERSE 2
Manual calculations, prone to a flaw, Dealing with shifts, odd hours, and the law. As your business grows, the cost takes flight, Automated solutions, shining bright.
PRE-CHORUS
Compliance is key, with FLSA’s might, Calculate and compensate, get it right. Avoid the audit’s gaze, fines and the cost, Retroactive pay, no longer lost.
CHORUS
Take back time, like a winding clock, Retroactive pay, mending every block. Calculate the hours, with precision and grace, In the world of care, in this payroll space.
BRIDGE
Employee satisfaction, a crucial part, Resolve mistakes, a work of heart. Relationships flourish, in pay’s embrace, A payroll software, creating a trace.
VERSE 3
Star caregivers, valued and strong, Retention and recruiting, where they belong. Automated solution, a total pay dance, Establish your business, a work-life romance.
PRE-CHORUS
A self-winding watch, Viventium’s grace, Optimizing payroll, in every case. No more struggles, in the payroll game, In it with you, time and time again.
CHORUS
Take back time, like a winding clock, Retroactive pay, mending every block. Calculate the hours, with precision and grace, In the world of care, in this payroll space.
OUTRO
As your business grows, in the hustle and fight, Viventium by your side, making it right. No more worries, in the payroll chain, In it with you, time and time again.
Geo Tax, oh Geo Tax, our savior in the night, Guiding us through tax laws, shining a bright light. No more payroll worries, no more sleepless nights, With Viventium’s help, we’ll be alright.
VERSE 1
In the world of business, we all aim to thrive, Year after year, our dreams taking flight. But as we soar higher, we start to see, More money, more problems, just like B.I.G. Outgrowing our shell, it’s an exciting phase, But it brings with it some challenging days. Solutions we had, now show their flaws, As we push the boundaries, breaking through the walls.
CHORUS
Geo Tax, oh Geo Tax, our savior in the night, Guiding us through tax laws, shining a bright light. No more payroll worries, no more sleepless nights, With Viventium’s help, we’ll be alright.
VERSE 2
Employees across states, in different localities, Tax laws aplenty, creating complexities. Our old software’s limits, we’ve begun to see, Scaling up our business, we need to break free. Calculating pay and taxes, where it all begins, Errors in this process, lead to countless sins. Employees rely on us, trust in our might, To withhold what’s needed, get it just right.
CHORUS
Geo Tax, oh Geo Tax, our savior in the night, Guiding us through tax laws, shining a bright light. No more payroll worries, no more sleepless nights, With Viventium’s help, we’ll be alright.
BRIDGE
Taxes, they’re not simple, that’s for sure, A world of complexity, there’s always more. But Viventium stands with us, in this fight, Geo Tax, our ally, making everything right.
VERSE 3
CPAs may struggle, and admins too, Keeping up with taxes, what can they do? The rules keep changing, it’s hard to keep pace, But Viventium’s here, in this challenging space.
CHORUS
Geo Tax, oh Geo Tax, our savior in the night, Guiding us through tax laws, shining a bright light. No more payroll worries, no more sleepless nights, With Viventium’s help, we’ll be alright.
OUTRO
So relax, dear business, and set your mind free, With Geo Tax on our side, we’re the best that we can be. Viventium’s got us, in this tax-filled fight, No more worries, no more sleepless nights.
REPEAT CHORUS
Geo Tax, oh Geo Tax, our savior in the night, Guiding us through tax laws, shining a bright light. No more payroll worries, no more sleepless nights, With Viventium’s help, we’ll be alright.
Configurable Payroll Grids, a helping hand in sight, In the realm of admin life, where details are rife. With custom views and filters, they navigate through the night, Let’s celebrate this feature, it’s the heart of our work life.
VERSE 1
In the world of admin tasks, where changes often arise, There’s a tool that’s been a savior, under office fluorescent skies. With flexibility and precision, it eases their daily strife, Let’s sing about this feature, it’s the pulse of our work life.
CHORUS
Configurable Payroll Grids, a helping hand in sight, In the realm of admin life, where details are rife. With custom views and filters, they navigate through the night, Let’s celebrate this feature, it’s the heart of our work life.
VERSE 2
Admins wear many hats, in their daily grind, Sometimes they need to adjust, leave no errors behind. Adding extra hours, bonuses, or fixing pay, They need a simple method, to make it all okay.
CHORUS
Configurable Payroll Grids, a helping hand in sight, In the realm of admin life, where details are rife. With custom views and filters, they navigate through the night, Let’s celebrate this feature, it’s the heart of our work life.
BRIDGE
Custom views and filters, tailor it to your need, Focus on the important, no need for needless speed. A hundred-dollar bonus, a few clicks and it’s in flight, Admins get it done, making sure it’s right.
VERSE 3
In the admin’s world, where numbers have their say, This tool steps in gracefully, making tasks less gray. An interface so intuitive, like an Excel sheet, Changing data effortlessly, making work complete.
CHORUS
Configurable Payroll Grids, a helping hand in sight, In the realm of admin life, where details are rife. With custom views and filters, they navigate through the night, Let’s celebrate this feature, it’s the heart of our work life.
OUTRO
So here’s to Payroll Grids, in our song of praise they gleam, For admins working diligently, they fulfill a dream. In the world of office hustle, they bring much-needed light, Let’s tip our hats to this tool, and its invaluable might.
Rule-Based Automation, it’s the name of the game, Less manual toil, less stress and shame, With policies and standards, we’ll pave the way, To automate your chores and brighten your day.
VERSE 1
In the world of payroll, a daily task we face, Admins work hard, in this complex space, They handle policies, with attention and care, But there’s a solution that’s beyond compare.
PRE-CHORUS
Oh, payroll admins, your role’s crucial and true, But there’s a tool we’ve got, just for you, Let’s explore rule-based automation, my friend, With Viventium, your tasks will gently mend.
CHORUS
Rule-Based Automation, it’s the name of the game, Less manual toil, less stress and shame, With policies and standards, we’ll pave the way, To automate your chores and brighten your day.
VERSE 2
Standardize policies, that’s the key, For tenure, role, union status, you’ll see, PTO, bonuses, pay rates defined, Automation makes your workload more aligned.
PRE-CHORUS
Oh, payroll admins, the burden’s a load, But rule-based automation lightens the road, No more tiresome chores, no more dread, With Viventium, it’s smoother ahead.
CHORUS
Rule-Based Automation, it’s the name of the game, Less manual toil, less stress and shame, With policies and standards, we’ll pave the way, To automate your chores and brighten your day.
BRIDGE
In the world of payroll, where tasks repeat, We’ve got the solution, it’s oh so neat, “If this, then that,” it’s simple and sly, With Viventium by your side, you’ll reach for the sky.
VERSE 3
Tenure-based PTO, a common request, With Viventium, it’s passed the ultimate test, Set it up once, and then you’ll see, Automation handles the chore, oh so free.
PRE-CHORUS
Oh, payroll admins, take a breath, take a pause, With Rule-Based Automation, you’ll find no flaws, It’s easy, it’s simple, no programming in sight, Viventium’s got you covered, day and night.
CHORUS
Rule-Based Automation, it’s the name of the game, Less manual toil, less stress and shame, With policies and standards, we’ll pave the way, To automate your chores and brighten your day.
OUTRO
So if you’re a payroll admin, feeling the weight, Let Viventium’s Rule-Based Automation be your fate, No more worries, no more strife, With Viventium, you’ll transform your work life.
Oh, the Report Library, it’s the heart of the show, Where numbers come alive and insights start to flow. With Viventium’s aid, it’s a breeze, can’t you see? Reporting made easy, for your company to be free.
VERSE 1
In the world of business, it’s a complex game, With factors and figures, it’s never the same. Decisions are key, they’ll determine your fate, So listen up closely, don’t be a bit late.
PRE-CHORUS
Gather your data, don’t let it fade, In the depths of spreadsheets, don’t let it cascade. Your HCM software, is it up to the task? To capture and store, to help you unmask.
CHORUS
Oh, the Report Library, it’s the heart of the show, Where numbers come alive and insights start to flow. With Viventium’s aid, it’s a breeze, can’t you see? Reporting made easy, for your company to be free.
VERSE 2
Once the data’s collected, it’s time to report, But it can be daunting, that’s the common retort. Pre-built solutions, they’re your guiding light, Turning raw data into visions so bright.
PRE-CHORUS
No more manual hours, no errors in sight, With report library’s might, everything’s right. Payroll summaries, tax liabilities, and more, All in a flash, you’ll have what you adore.
CHORUS
Oh, the Report Library, it’s the heart of the show, Where numbers come alive and insights start to flow. With Viventium’s aid, it’s a breeze, can’t you see? Reporting made easy, for your company to be free.
BRIDGE
Viventium’s here, with a passion so true, Constantly improving, for folks just like you. A Report Library, a gift from the stars, For data-driven dreams, it’ll take you far.
CHORUS
Oh, the Report Library, it’s the heart of the show, Where numbers come alive and insights start to flow. With Viventium’s aid, it’s a breeze, can’t you see? Reporting made easy, for your company to be free.
OUTRO
So remember this lesson, in the business terrain, It’s all ’bout decisions, don’t let ’em wane. With data as your guide, and Viventium’s grace, You’ll conquer the challenges you’ll face.
