The CARES Act provides for payroll tax relief, including employee retention tax credits and the deferral of all employer Social Security tax payments to help employers in the face of economic hardship related to the COVID-19 pandemic. Employers should work with their tax advisors, payroll providers, and payroll departments to immediately implement these valuable savings. The broad-based employer and employee relief provided under the CARES Act includes two forms of payroll tax relief related to an employer’s Social Security tax payments: deferral of all employer Social Security tax payments, and employee retention tax credits of up to $5,000 for qualified wages paid to employees. All employers should consider taking advantage of these valuable tax savings to alleviate the broad and deep impact of the COVID-19 pandemic on businesses and their employees.
In the ongoing effort to help individuals impacted by COVID-19, Congress passed the Coronavirus Aid, Relief, and Economic Securities Act (CARES Act) on March 27, 2020. The President signed the CARES Act into law the same day. The historic stimulus package provides wide-ranging relief for both employers and employees. This includes rules that impact health and welfare, retirement and executive compensation plans and programs.
For more information about the impact of the CARES Act on employer-provided benefits, access our On the Subject articles on the:
- Impact of the CARES Act on Health and Welfare Benefits
- Impact of the CARES Act on Retirement Plans and Student Loan Benefits
- Impact of the CARES Act on Executive Compensation
In addition, for information about the frequently asked questions regarding health and welfare, retirement and executive compensation issues in the COVID-19 era, access our FAQs.