April 21, 2021 - Douglas Myser

New tax cuts and credits in stimulus bill. The $1.9 trillion stimulus bill that Congress just passed, and President Biden signed into law, has more than just stimulus checks for Americans. In Fact, the majority of the bill has a large number of tax cuts and credits, designed to help the economy, by helping a large number of Americans. For self employed Americans, the number of days a self employed individual can take in calculating the qualified family leave equivalent amount for self employed individuals increases from 50 to 60. The paid leave credits will be allowed for leave that is due to a COVID-19 vaccination. The limitation on the overall number of days taken into account for paid sick leave will reset after March 31, 2021. The credits are expanded to allow 501(c)(1) government organizations to take them. The employee retention credit portion of the bill, extends the credit through the end of 2021. The employee retention credit was originally enacted in the Coronavirus Aid, Relief, and Economic Security Act, P.L. 116-136, and it allows eligible employers to claim a credit for paying qualified wages to employees. New tax cuts and credits in stimulus bill.

The bill extends the premium tax credit in Sec. 36B for 2021 and 2022, by changing the applicable percentage amounts in IRS Sec. 36(b)(3)(a). A special rule is attached that treats a taxpayer who has received, or has been approved to receive, unemployment compensation for any week beginning during 2021 as an applicable taxpayer. The bill also allows affiliated groups to elect to allocate interest on a worldwide basis. The bill provides that targeted Economic Injury Disaster Loan grants received from the U.S. small business administration are not included in gross income and that this exclusion will not result in a denial of a deduction, reduction of tax attributes, or denial of basis increase. Similar treatment is afforded SB restaurant revitalization grants. The bill temporarily delays the designation for multiemployer pension plans as in endangered, critical, or critical and declining status and makes other changes for multiemployer plans in critical or endangered status. New tax cuts and credits in stimulus bill.

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