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Securing Your Finances During COVID-19

COVID-19 Support for your:  Finances  |  Employees  |  Operations

The priority is to keep your business open, and that requires having sufficient funds in place. Take advantage of applicable loan options, business credits, and other financial programs that can help you at this critical juncture of the coronavirus pandemic.

PPP and Loan Forgiveness

A Paycheck Protection Program (PPP) loan can help you keep employees on payroll, bring back those you furloughed, and cover certain overhead costs. PPP loans may be forgiven if funds are used on eligible covered costs.

A business owner using a ppp loan forgiveness estimator

Employee Retention Credit

A refundable Federal tax credit against employer payroll taxes for businesses that complied with government order to partially or fully suspend operations, or recognized significant reduction in gross receipts but retained their employees.

Eligible employers can:

Take a refundable credit of 50% of qualified wages/health plan expenses up to $10,000 per employee against applicable employment taxes.

Update: Originally, if you took a PPP loan in the first round, you were not eligible for this tax credit against 50% of the wages paid to employees during the pandemic. This is no longer the case under the law and recipients of a PPP loan from the inception of the program who meet certain conditions can claim this credit on wages that were not forgiven payroll expenses.

Among other changes are:

  • An increase in credit amount to 70% on qualified wages paid in 2021
  • A safe harbor allowing employers to use prior quarter receipts as a comparison
  • An increase on the employee wage limit — $10,000 for the first two quarters of 2021 as compared to $10,000 annually in 2020

The deadline to claim the employee retention tax credit is extended to June 30, 2021.

The law also reverses IRS guidance to allow a tax deduction on PPP forgivable expenses and makes it effective as of the enactment of the CARES Act on March 27, 2020.

An employee working at a grocery store

Payroll Tax Deferral Period

Employers can defer payment of applicable employer payroll taxes (employer portion of Social Security) incurred from March 27, 2020 – Dec. 31, 2020.

How deferred repayments are split and paid

  • 50% due Dec. 31, 2021
  • 50% due Dec. 31, 2022

Deferring payment of employer payroll taxes

Employers can now defer or continue to defer payment of the employer share of Social Security taxes even after PPP loans are forgiven.

Looking at the payroll tax deferral period

State Unemployment Insurance Tax Credit

Some states have enacted legislation that provides employers with a SUI tax credit if they paid their first-quarter SUI contributions on or before a specific date. The credit amount equals the amount of first-quarter 2020 contributions paid by the employer and is applicable to second-quarter 2020 SUI contributions.

SUI map

Other Funding Options

You and your accountant might determine there are better courses of action to obtain financing based on your business and industry needs.

SBA loans

Small businesses that don’t qualify for traditional small business financing may find other opportunities through SBA loan programs.

Main Street Lending Program

Established by the Federal Reserve to support lending to businesses that were in sound financial condition before the onset of COVID-19.

Business lines of credit

Monthly payments and interest are determined based on how much of the open line of credit you use.

Term loans

Depending on the amount financed, loans can be either short-term or long-term, and can generally be secured from any lender.

Paychex Promise

Get the ultimate peace of mind for your business — payroll funding services to help you pay employees during and after the pandemic. 

Payroll Protection

We provide you the flexibility to extend the collection of payroll funds from your bank account by up to seven days without interruption of services or insufficient fund charges.

Business Credit Service

Paychex sends payment history to credit bureaus with the goal of building your business credit file and improving your ability to secure attractive financing terms.

We have solutions that can support you during COVID-19, and beyond

Live and recorded webinars

Available in English
Vaccination and the Workplace: Key Considerations
April 7, 2021

Wondering what, if any, role your organization should play in motivating employees to get the COVID-19 vaccine? If you’re thinking about developing a COVID-19 vaccination policy, watch this webinar to learn about:

American Rescue Plan Act Overview
March 24, 2021

The American Rescue Plan Act of 2021 gives many businesses the opportunity for additional relief funding. Watch to learn about tax credit changes, grant programs aimed at restaurants and shuttered venues, an extension of unemployment insurance benefits, COBRA subsidies, and more.

How Paychex Can Help with PPP Loan Forgiveness
March 23, 2021

With the approval of $284 billion in additional funds for Paycheck Protection Program (PPP) loans, more guidance has come out for business owners, including an expansion of eligible costs, an opportunity for a second draw, and availability to also use Employee Retention Tax Credit (ERTC) on unforgiven COVID-19 expenses.

Articles to help business during COVID-19 pandemic

Available in English
COBRA Continuation Coverage to be Subsidized 100% for Qualified Individuals Under American Rescue Plan
April 8, 2021
Under the American Rescue Plan Act, eligible individuals who have lost employer-sponsored health insurance after involuntary job loss or because of reduced hours will have COBRA continuation coverage subsidized 100 percent for a specified time period.
Application Process for Shuttered Venue Operator Grant Program Opens April 8
April 6, 2021
The Shuttered Venue Operator Grant program has allocated $16 billion to businesses such as live venues, theaters, museums and other organizations that had to remained close through much of the COVID-19 pandemic.
Businesses Can Take Advantage of Available Financial Relief through the CARES Act
March 30, 2021
This article details guidance provided by the IRS and the U.S. Department of Labor for some of the aspects of the Coronavirus Aid, Relief, and Economic Security Act (CARES), a stimulus package providing financial relief for businesses, families, and individuals.

* This content is for educational purposes only, is not intended to provide specific legal advice, and should not be used as a substitute for the legal advice of a qualified attorney or other professional. The information may not reflect the most current legal developments, may be changed without notice and is not guaranteed to be complete, correct, or up-to-date.