American Rescue Plan Act

The American Rescue Plan, recently passed by Congress, provides additional relief to individuals and businesses impacted by the COVID-19 epidemic. Below is a summary of key provisions relevant to our clients, pending further guidance from the DOL.

Employee Retention Tax Credit

• Extended through the 3rd and 4th quarters of 2021.
• 2020 credits must be completed by June 1, 2021.

FFCRA Paid Leave Tax Credits

• Extended for voluntarily providing paid sick and family leave through September 30, 2021.
• Colorado employers must also comply with the PHE (public health emergency) paid leave obligation.
• DOL has not clarified whether employers voluntarily abiding by FFCRA can cap leave at 80 hours or must extend it to the 14 weeks noted in the Act.

Dependent Care Assistance

• Increased exclusion for employer-provided dependent care assistance in 2021 from $5,000 to $10,500.
• Employees are being contacted to voluntarily increase their elections if desired.

COBRA Subsidy

• Temporary 100% subsidy for COBRA qualified beneficiaries where the qualifying event was an involuntary termination or reduction in hours due to the pandemic.
• Subsidy applies from April 1, 2021, to September 30, 2021.
• Administered by the employer, plan, or insurer, with reimbursement via a refundable payroll tax credit.
• Managed by TPA 24hourflex.

ACA Premium Tax Credits

• Temporary elimination of the upper income limit (currently 400% of the federal poverty level) for eligibility in 2021 and 2022.
• Increased premium tax credits by reducing the amount individuals must contribute to coverage costs.

Paycheck Protection Program (PPP)

• Expanded eligibility guidelines to include more nonprofit entities.

Restaurant Revitalization Fund

• Direct subsidy of $28.6 billion for restaurants, administered by the Small Business Administration.
• $5 billion set aside for restaurants with gross revenue under $500,000.

Unemployment Provisions

• Extension of several unemployment provisions from the CARES, Family First, and CAA bills, including:
  • Waiver of interest on outstanding loans to states for unemployment compensation.
  • 100% federal reimbursement of regular extended unemployment benefits.
  • Additional funding for systems and fraud prevention.
  • Increased federal reimbursement credits to reimbursing employer accounts.
• Temporary federal unemployment benefits increased by $300 per week through August 29, 2021.

As further guidance becomes available, we will share updates to help navigate these benefits accurately.