ASSOCIATIONINSIGHT
Portable Sanitation Association International News
BIWEEKLY EDITION JANUARY 6, 2021
Page 2
Provisions of the New Coronavirus Relief Package…continued from page 1
Continued on page 13
The CAA includes the following provisions relevant to portable sanitation companies:
• Expanding the Paycheck Protection Program (PPP). An additional $284 billion has been allocated for the
PPP. Businesses that already received a PPP loan will be eligible to get a second one under the new terms.
Some of the PPP funds will be set aside for the smallest businesses and community-based lenders, and the
relief package also provides $20 billion in Economic Injury Disaster Loans for smaller businesses.
• Extending the Work Opportunity Tax Credit (WOTC). The Work
Opportunity Tax Credit (WOTC) is a federal tax credit available to
employers who hire and retain individuals from target groups with
significant employment barriers (e.g., veterans, ex-felons, persons
from poorer circumstances, etc.). Employers can claim about $9,600
per employee in tax credits per year under the WOTC program.
Additionally, there is no set limit to the number of individuals an
employer can hire in order to claim the tax credit. This program has
been extended through December 31, 2025.
• Health and dependent care flexible spending arrangements. The
CAA relief package allows taxpayers to roll over unused amounts
in their health and dependent care flexible spending accounts from 2020 to 2021 and from 2021 to 2022.
This provision also permits employers to allow employees to make a 2021 mid-year prospective change in
contribution amounts, which can help them respond more effectively to potential out-of-pocket healthcare
costs later in the year or early in the following year.
• Extending the employee retention tax credit. The Employee Retention Credit under the CARES Act
encourages businesses to keep employees on their payroll. Under the CAA, the refundable tax credit has been
increased. Eligible employers whose businesses have been financially impacted by COVID-19 can now claim
70 percent (up from 50 percent) of up to $10,000 in wages paid. Businesses with PPP loans can now qualify for
this program as well.
• Deduction for business meals. The CAA provides a temporary allowance of full deduction for business
meal food and beverage expenses provided by a restaurant that are paid or incurred in 2021 and 2022. The
previous deduction was for only 50 percent of such expenses.
• Employer credit for paid family and medical leave. Back in
2017, the Tax Cuts and Jobs Act provided a federal tax credit
for employers who provide paid family and medical leave to
their employees. The CAA legislation extends the employer
credit through December 31, 2025, and it applies to wages
paid in taxable years beginning after December 31, 2020.
• Employer credit for paid sick leave and family leave. In March
2020, the FFCRA provided a refundable payroll tax credit for
mandated paid sick and family leave. The CAA extends the
tax credit through March 2021 for employers that continue to
voluntarily offer paid sick and family leave to their employees.
• Employer-provided student loan repayment. The original CARES Act allowed employers to provide student
loan repayment as a benefit for employees through December 31, 2020. The CAA legislation has extended
this benefit through December 31, 2025. This means an employer may contribute up to $5,250 annually
toward an employee's student loans, and such payment would be excluded from the employee's income. The
$5,250 cap applies to both the new student loan repayment benefit as well as other educational assistance
(e.g., tuition, fees, and books) provided by the employer under existing law.
