Consolidated Appropriations Act Expands Employee Retention Credit

January 21, 2021

Consolidated Appropriations Act Clarifies and Expands Employee Retention Credit

The Consolidated Appropriations Act, 2021, was signed into law on December 27, 2020. Among many changes and updates to the prior relief legislation for COVID-19, this law clarifies and expands the employee retention credit created by the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

Key Highlights
The employee retention credit applies more broadly as a result of changes made by the Consolidated Appropriations Act, 2021.

Most of the changes are effective as of January 1, 2021, and impact the first two quarters of the year.
Note this key retroactive change: employers who took PPP loans are now eligible to take the employee retention credit, so long as the same wages are not used for both.

For a detailed comparision of the original and new law, click here.

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Article compiled by David Peritz.