CARES Act: Retention Credit and Social Security Deferment
Hello valued Client Partners!
During this unprecedented health crisis, we’ve been hard at work Seeking, Interpreting and Acting on the latest information made available by the IRS and DOL. While these agencies are still providing “Rolling Updates”, we thought it would be important to formally communicate with all of you regarding the present status of the CARES Act Provisions and how PayServ Systems, Inc. can “Go the Distance” and support you through this.
Based on our informed and current understanding of the CARES Act Legislation, please read the following. Also, please visit our Service Readiness Team Page and click on the Coronavirus Response Resources button to find valuable resources.
- 100% ER Social Security Deferment
- Any company who has not received funds through the PPP can take advantage of this, regardless of the impact of Coronavirus on your organization.
- Please find the “ER Social Security Deferment – Client Attestation” document.
- Please complete and return if you’d like to defer your ER Social Security taxes until 2021 and 2022.
- We require that if a client wishes to turn off this set up, they contact their designated Customer Support Person via Email or through Support Bench.
- These taxes will still be owed, but just deferred until 2021 and 2022.
- Payroll Report “Tax Wage Detail” inside of our WorkforceTHRIVE system will account for the deferred Social Security Taxes to ensure proper and accurate tracking.
- ER Retention Credit: (50% of up to $10,000 in employee “Qualified Wages” and Section 125 Benefit Liabilities)
- IRS: Employee Retention Credit
- Client requirements
- Determine if you are eligible for these programs.
- Determine if you are over or under 100 employees based on appropriate methods of figuring. (The method for calculating wages differs between those 2 groups)
- Determine which employees are being paid for not working.
- Determine the timeframe in which the credit should be calculated.
- Complete and file IRS form 7200 with the IRS.
- Submit each form 7200 to PayServ as well.
- Please visit this link for the “Pre-Filled IRS Form 7200." As PayServ is both the 3rd Party Payer and 3rd Party Designee, there is information about our company that must be included on this form.
- PayServ will make the appropriate modifications to the quarterly tax returns and also track the reduced liability for the ER Social Security Deferment that you may also be taking advantage of.
- If your credit exceeds the ER Social Security Liability the IRS will send you a check for the difference. (Assuming you’ve been completing and filing the form 7200.)
- PPP (Paycheck Protection Program) Application Support Reporting
- For those clients who are applying for PPP loans / grants, please find this user guide. This guide will walk you through the process of updating reports inside of our system to get accurate payroll data for your PPP Loan applications!
Thank you all for your continued partnership. While PayServ Systems, Inc. is providing our client partners with information, system guidance and support, we must request that each of you to discuss your COVID-19 strategies with your Finance and Legal Teams to determine the best course of action for you. We hope that you find this information valuable and we look forward to assisting you throughout this unprecedented time.