Summary of American Rescue Plan Act (ARPA) of 2021 for Businesses

Restaurant Revitalization Grants

Grants will be available in the near future for restaurants and other food and beverage businesses that are impacted by current economic conditions. These grants will be processed through the Small Business Administration (SBA).

Extension and Expansion of the Families First Coronavirus Response Act (FFCRA) Sick/Leave Pay

• The period that is available to claim the FFCRA Sick/Leave Pay has been extended from March 31, 2021 to September 30, 2021.
• The credit can now include the employer’s share of Social Security and Medicare Tax.
• The amount of wages an employer may claim per employee increased from $10,000 to $12,000.
• The sick/leave time now includes a provision to allow employees to obtain the COVID-19 v

Extension of Employee Retention Credit

• The Employee Retention Credit (ERC) has been extended from June 30, 2021 to December 31, 2021.
• ARPA also clarifies the ERC is not available for wages paid with PPP or PPP round two funds, shuttered venue assistance, or the Restaurant Revitalization G

Expansion of Paycheck Protection Program (PPP)

• Allocates an additional $7.25 billion to PPP funding
• Adds “additional covered nonprofit entity” as an eligible nonprofit eligible for First Draw and Second Draw PPP loans. An “additional covered nonprofit entity” is an organization listed in Code Sec. 501(c)other than those Code Sec. 501(c)(3), Code Sec. 501(c)(4), Code Sec. 501(c)(6), or Code Sec. 501(c)(19).  If:
  1. The organization employs no more than 300 employees;
  2. It does not receive more than 15% of its receipts from lobbying activities;
  3. Lobbying activities do not comprise more than 15% of the organization’s total activities; and
  4. The cost of lobbying activities does not exceed $1,000,000 during the most recent tax year that ended prior to February 15, 2020.

Clarification on Taxability of Restaurant Revitalization Grants and EIDL Advances

HR 1319 clarifies that Restaurant Revitalization Grants and the EIDL Advance are generally excluded from gross income and other tax-related calculations.