Gross Receipts for Employee Retention Credit Does NOT Include Certain COVID Relief Funds

Revenue Procedure 2021-33, issued by the IRS on August 9, 2021, now answers one of our biggest Employee Retention Credit (ERC) questions: Are Paycheck Protection Program (PPP) loans included in gross receipts for ERC eligibility? Based on this guidance, the answer is NO.

ERC Eligibility Refresher

As a reminder, an employer is eligible for the ERC through one of three ways during 2021:

  1. A full or partial suspension of operations due to a government order;
  2. A gross receipts decline of over 20% when compared to the same quarter in 2019; or
  3. Qualification as a Recovery Startup Business (2021 Q3 and Q4 only).

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Public Support Test – Why It Matters for Both Public Charities and Private Foundations

Whether you are an established public charity or one in its infancy years, or you’re a private foundation making grants to public charities, understanding the public support test is key to ensuring that donors maintain a favorable tax deduction and that private foundations do not inadvertently make a taxable expenditure. This article will cover what the public support test is and how your organization can best understand and manage it.

The Public Support Test and Public Charities

There are many different types of public charities. But for this article, we will focus on the public support tests for IRC Sections 509(a)(1) and 509(a)(2) organizations,

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Employee Retention Credit: Latest Updates and Extension Through 2021

The rules and guidance for the employee retention credit (ERC) continue to change as we go. The American Rescue Plan Act of 2021, signed on March 11, 2021, now allows an extension of the ERC through the end of 2021. As organizations continue on the path of recovery from the pandemic, this credit can yield sizeable cash flow to those who qualify.

In addition to the extension of the credit, the IRS released official guidance on the ERC for 2020 and 2021 (Notice 2021-20 and Notice 2021-23). While much of the additional guidance simply repeats the Frequently Asked Questions posted to the IRS website last year,

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Retroactive Changes to the Paycheck Protection Program for 2020 Borrowers

On December 27, 2020, the Consolidated Appropriations Act of 2021 (CAA) was signed into law. In addition to funding new Paycheck Protection Program (PPP) loans, the CAA relaxed certain rules governing the program and made many retroactive changes applicable to PPP loans issued in 2020.

If your organization took advantage of the PPP loan program in 2020, below is a summary of the program rules, before and after the passage of the CAA.

Guide to PPP Loan Forgiveness

If you are looking for more information, we have published a five-part series on PPP loan forgiveness. Some of these articles were originally published before the passage of the CAA and do not reflect the recent modifications to the rules.

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Changes for First Time Paycheck Protection Program Borrowers in 2021

In March 2020, the Paycheck Protection Program (PPP) came into play as a result of the CARES Act.  Many businesses were quick to jump at the opportunity to secure additional funding due to the dramatic impact the shutdowns had on their operations. However, other businesses did not take advantage of the loan program, either because they were an ineligible type of business, or they simply didn’t have enough economic uncertainty to qualify. Now, those businesses have another opportunity available.

On December 27, 2020, the Consolidated Appropriations Act of 2021 (CAA) was signed into law and authorized an additional $284 billion in new PPP loans.

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