New COVID-19 Stimulus Bill
Congress passed, and the President signed into law, the Senate Amendment to H.R. 133 – Bipartisan-Bicameral Omnibus & COVID Relief Package. This NECA-supported package contains months of work and input from Members of Congress and stakeholders, including NECA. The final COVID relief package is approximately $900 billion. It also completes the FY21 appropriations process and adheres to the established budget caps, totaling $2.3 trillion dollars, making it among the largest spending bills ever considered by Congress, topping the $2.2 trillion CARES Act.
NECA is pleased that the following key provisions were included in the COVID Relief Package:
- Clarification of Tax Treatment of Paycheck Protection Program (PPP) Loans – In a major win for NECA, the bill specifies that forgiven PPP loans will not be included in taxable income. It also clarifies that deductions are allowed for expenses paid with proceeds of a forgiven PPP loan, effective as of the date of enactment of the CARES Act and applicable to subsequent PPP loans. This same tax treatment also applies to Economic Injury Disaster Loan (EIDL) grants and certain loans and loan repayment assistance.
- Extension of Paid Sick and Family Leave Tax Credit – Expands the employer tax credit that was established in the Families First Coronavirus Response Act, through March 21, 2021. However, employers are not required to provide employees with FFCRA leave after December 31, 2020. As of January 1, 2021, employers may voluntarily provide emergency paid sick leave or emergency paid leave under FFCRA to continue receiving the tax credit benefits associated with this leave. The tax credit may only be taken for leave through March 31, 2021.
- Provides a Second Draw Paycheck Protection Program (PPP) Forgivable Loan – Second draw of PPP loans is available for the hardest-hit small businesses and nonprofits with 300 or fewer employees that can demonstrate a loss of 25% of gross receipts in any quarter during 2020 when compared to the same quarter in 2019.
- Expands Paycheck Protection Program (PPP) – Eligibility for 501(c)(6) nonprofits, including tourism promotion organizations and local chambers of commerce.
- Simplifies Paycheck Protection Program (PPP) Forgiveness – Streamlines the forgiveness process for loans of $150,000 and less.
- Summary of Tax Provisions
- Summary of PPP Provisions
- NECA Legal Alert regarding the New COVID-19 Stimulus Bill