Scott, Hassan Lead Bipartisan Bill to Reinstate Employee Retention Tax Credit
WASHINGTON — Sens. Tim Scott, R-S.C., and Maggie Hassan, D-N.H., on Thursday introduced legislation to reinstate the Employee Retention Tax Credit that expired for most businesses in September.
Originally introduced by the CARES Act in 2020, the program provided employers a tax credit of up to $7,000 per employee per quarter if their business reduced by at least 20% compared to 2019, according to the Internal Revenue Service. Business groups like the American Society of Travel Advisors had lobbied for the program to be reinstated after the passage of the Infrastructure Investment and Jobs Act shortened its expiration to Sept. 30, 2021.
The new bill would retroactively let small businesses and nonprofits that kept workers on the payroll in the fourth quarter of 2021 claim the tax credit. It is expected to come before the Senate Small Business Committee for a hearing.
“As businesses were forced to close during the pandemic, too many small business owners had to lay off employees,” Scott said in a written statement. “Thankfully, the Employee Retention Tax Credit became a crucial mechanism by which these business owners could rehire or retain workers. Providing stability and certainty should be a key consideration in any legislation impacting entrepreneurs and workers, which is needed now more than ever as they power our economic recovery.”
The refundable tax credit encompasses 50% of up to $10,000 in wages paid by an eligible employer of a business impacted financially by the COVID-19 pandemic. Interest in renewing the program comes as businesses around the country continue to deal with the effects of the omicron variant.
The senators’ bill is a companion to legislation filed in the House in December by Rep. Carol Miller, R-W.Va., which was originally cosponsored by Reps. Stephanie Murphy, D-Fla., Kevin Hern, R-Okla., and Terri Sewell, D-Ala. Sens. Mark Warner, D-Va., Shelley Moore Capito, R-W.Va., and Ben Cardin, D-Md., are original cosponsors of the Senate version.
“New Hampshire’s small businesses are the engine of our state’s economy, and this tax relief that I’m pushing for will further support our businesses and nonprofits that have continued to create jobs and keep workers on payroll,” Hassan said in a written statement. “The Employee Retention Tax Credit gave businesses a lifeline that they could use to keep their employees on payroll, and my bipartisan bill reinstates this important tax credit. I urge my colleagues to join us in supporting this common sense legislation.”
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