(Blogger's Note Updated Sunday, 1:30 AM: President Trump signed the Consolidated Appropriations Act, 2021 containing the Coronavirus Response and Relief provisions passed by Congress last Monday. Payroll credit extensions and expansions, a new wave of PPP loans, and further flexibility in forgiveness are now the law. Check this space frequently for continuing updates.)
(Blogger’s Note: As of Tuesday night December 22, President Trump implied he may veto the bill if it does not undergo major changes, including a direct stimulus payment of $2,000 instead of $600.)
(Blogger’s Note: Late last night, December 21, the bill passed in the House and Senate and is slated to be signed by the President today, December 22.)
Written Monday, Dec. 21, 2020, at 2:15 PM
After partisan stops, stalls, and restarts, lawmakers reached a bipartisan agreement Sunday night on a $900 billion COVID-19 relief bill.
No, it’s not the law yet. But by all predictions, it will be – today, tomorrow, or the next . . . and almost certainly before the end of the week.
Update: Both the House and Senate assert that they will vote on the bill today, Monday. “We’re going to stay here until we finish tonight,” asserted Senate Majority Leader Mitch McConnell.
The bill is entitled the Emergency Coronavirus Relief Act of 2020 (ECRA) and is the second largest relief package to date, following the $2 trillion CARES Act passed on March 25, 2020.
The text of the legislation was released at 1:50 PM, just hours before the House is scheduled to vote and with an anticipated Senate vote to follow.
The bill is 5,593 pages long, and although the details are fuzzy, legislators have painted broad strokes of a relief picture which includes:
We know: Under the proposed legislation, a new round of loan applications will be processed. Qualified expenses will be expanded to include supplier costs and safety investments in facility modifications and personal protective equipment (PPE). Loans of less than $150,000 will be eligible for a simplified forgiveness process.
We ask: Who will qualify for the new round? How soon after the President signs the legislation will loan applications be processed? For how long will they be accepted? Will a new forgiveness application be released for the first round of loans or only for the newest round? Will the easing of restrictions for loans under $150,000 obviate wage and FTE reduction calculations? Will that leniency apply to first-round loans as well?
We know: Since its inception, the deductibility of PPP expenses for companies who can establish decreases in 2020 revenues 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.
We ask: Will ECRA grant full deductibility of PPP expenses? What documentation will be required for establishing a decrease in revenues?
We know: ERC was set to expire on December 31, 2020.
We ask: Will the extension be for the entirety of 2021? Will the $10,000 wage limit be increased? Will the 50% credit per employee be increased?
We know: FFCRA-mandated paid sick leave is set to expire on December 31, 2020.
We ask: Will the FFCRA payroll tax credits be extended, or will ECRA create a corporate tax credit? Will further Federal paid leave be mandated under ECRA, or will paid leave be at the employer’s discretion, incentivized by this credit? How will employers be expected to track paid leave?
We know: Congress has strong motivation to pass the ECRA, and President Trump has stated he will sign the bill into law this week. In addition, Democrats have stated that this is only an appetizer; a full-course relief package will be top priority for the incoming Biden administration.
We ask: When will the vote happen? Will any unforeseen procedural delays arise? Will any of the just-revealed wording spark further partisan debate?
Be sure to check this space frequently for continuing Viventium coverage and updates.
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