Why the employee retention credit is an overlooked stimulus issue
05 August 2020
D.C. remains deadlocked on the next stimulus package, days after extended unemployment benefits ended and days before PPP is set to expire.
Where it stands: One unresolved issue that hasn't gotten enough attention is a proposed expansion of the employee retention credit, which could have a significant impact for companies that have experienced severe revenue declines.
The backdrop: The CARES Act established the initial version, a refundable payroll tax credit that could cover up to $5,000 per employee, for businesses that had suffered at least 50% revenue loss.
- Caveat #1: If a company received a PPP loan, it wasn't eligible.
- Caveat #2: If a company had more than 100 employees who remained working full time, including remotely, it wasn't eligible.
- Caveat conclusion: For most companies, this credit wasn't too valuable.
What's new: Both new stimulus plans — HEROES Act (D), HEALS Act (R) — are much more generous.
- HEROES increases the credit to up to $36k per employee (or up to 80% of wages paid per retained employee), with sliding-scale revenue eligibility for companies with revenue drop of between 10% and 50%. It increases the limit on working employees to 1,500.
- HEALS increases the credit to up to $30k per employee (or up to 65% of wages paid per retained employee), with the revenue decline threshold cut to 25%. It increases the limit on working employees to 500.
- Neither proposal restricts companies that received PPP loans, although they're silent on companies that participate in a possible PPP extension.
The bottom line: There are still partisan differences, but both sides are moving in the same direction on this, which suggests more flexibility than on thornier issues like school funding and liability protections.
Transcripts show George Floyd told police "I can't breathe" over 20 times
Section2Newly released transcripts of bodycam footage from the Minneapolis Police Department show that George Floyd told officers he could not breathe more than 20 times in the moments leading up to his death.
Why it matters: Floyd's killing sparked a national wave of Black Lives Matter protests and an ongoing reckoning over systemic racism in the United States. The transcripts "offer one the most thorough and dramatic accounts" before Floyd's death, The New York Times writes.
The state of play: The transcripts were released as former officer Thomas Lane seeks to have the charges that he aided in Floyd's death thrown out in court, per the Times. He is one of four officers who have been charged.
- The filings also include a 60-page transcript of an interview with Lane. He said he "felt maybe that something was going on" when asked if he believed that Floyd was having a medical emergency at the time.
What the transcripts say:
- Floyd told the officers he was claustrophobic as they tried to get him into the squad car.
- The transcripts also show Floyd saying, "Momma, I love you. Tell my kids I love them. I'm dead."
- Former officer Derek Chauvin, who had his knee on Floyd's neck for over eight minutes, told Floyd, "Then stop talking, stop yelling, it takes a heck of a lot of oxygen to talk."
Read the transcripts via DocumentCloud.