COVID-19 - Your myPay Solutions team is here to support you

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This article provides information for our Payroll Partners about the COVID-19 virus situation and what myPay Solutions is doing to assist with all of your payroll needs.

COVID – 19 American Rescue Plan Act

Coronavirus Aid, Relief, and Economic Security Act (CARES Act)

  • myPay Solutions has made a Paycheck Protection Program Report available within the myPay Solutions Direct application to help determine your average monthly payroll costs.
  • We have updated the Paycheck Protection Program Report to include an option to calculate 3.5x average monthly payroll costs in response to the updated stimulus package that was passed on December 27, 2020.

    When choosing the parameters of the report, there is now the option to select Use 3.5x Multiplier. Show me.

    • To run the Paycheck Protection Program Report, log into your secure portal, select Applications and open the myPay Solutions Direct application.
    • Once the program opens, choose Print Reports from the menu on the left, and select the report titled Paycheck Protection Program.
    • You can select the appropriate date range and reporting options based on your needs. The report defaults to 2019 totals and total gross wages for the timeframe selected. Show me.
      COVID PPP Report Selection
  • The Paycheck Protection Program Report includes:
    • Paycheck Protection Program Report example. Show me.
      COVID PPP Report Preview
    • The ability to provide details by employee or as a company.
    • The following explanations listed at the top of the report:
      • Total Gross Wages include all wages except Independent Contractor Earnings, Reimbursements, and Federal Unemployment. The Monthly and 2.5 x Monthly Average and 3.5 x Monthly Average calculations exclude compensation over $100,00.00.
      • Employer Paid FICA includes the Employer Portion of Social Security and Medicare.
      • State Unemployment includes any State Unemployment amounts.
      • Employer Contributions include any Employer Reported Health Insurance and Retirement Contributions.
    • Column Details for both Employee Details and Company Totals:
      • Total: This is the total amount as depicted for the specified row.
      • Compensation in Excess of $100,000: This is the earnings in excess of $100,000.
      • Monthly Average: This is the amount listed in the total column subtracting any Compensation in Excess of $100,000 divided by 12.
      • 2.5 X Monthly Average: This is the amount of the monthly average multiplied by 2.5.
      • 3.5 X Monthly Average: This is the amount of the monthly average multiplied by 3.5.
  • The Paycheck Protection Program Report excludes:
    • 1099 wages paid
    • Reimbursements (Exclusion is done by name containing “REIM”)
    • Federal Unemployment Taxes
    • Costs over $100,000 on an annualized basis for each employee. The amount that is in Excess of $100,000 will appear in a separate column.
  • For purposes of calculating the average monthly payroll, most businesses will use the average monthly payroll costs for 2019, excluding costs over $100,000 on an annualized basis for each employee.

Note: You should confirm with your lender which specific look-back dates they require for your application. If you wish to run the report for any specific 12-month period, you can modify the date ranges of the Paycheck Protection Program Report to fit your lender’s needs.

Process:

  1. Specialist receives either the Form 7200, amount for Employee Retention Credit or amount for ER Sponsored health care.
  2. Specialist receives the signed tax waiver (See Attached). Waiver and details from step one are saved in FC under 2020 Client Tax Information.
  3. Email template is sent to MPS Supervisors/ Tracy/Dawn.
    1. MPS Supervisors will save the email in a separate folder to track if needed for future.
    2. Dawn will make the manual adjustments.
  4. Specialist submits amendment request via EMS.
    1. If it’s before July 15, fee for 941 amendment can be waived since they haven’t actually been transmitted yet.
    2. If it’s after July 15, the specialist will bill the normal 941 amendment fee since they are starting to be transmitted.

Tax Waiver Q2 941 Adjustments

Email Template to MPS Supervisors

  • The Employee Retention Credit is part of the CARES Act designed to encourage businesses to keep employees on their payroll.
  • You can use the COVID-19 sick pay items under the Family First Coronavirus Response Act in conjunction with the credit, however, COVID-19 sick pay items are excluded when calculating qualifying wages.
  • The offset of taxes is for employee and employer paid Social Security and Medicare taxes in addition to Federal Withholding.
  • Get the full details on the IRS website regarding the Employee Retention Credit under the CARES Act.
  • You should consult your accountant for further guidance if you have any questions about the Employee Retention Credit

2020

  • The Employee Retention Credit provides for a fully refundable tax credit equal to 50% of qualified wages (including qualified health plan expenses) paid between 03/13/2020 and 12/31/2020. The maximum amount of qualified wages taken into account for each employee is $10,000.00 (for the year) which makes the maximum tax credit $5,000.00 ($10,000.00 x 50%) per employee (for the year).
  • The calculation is a per employee calculation of gross wages up to 50% of $10,000, meaning a cap of $5,000 gross wages per eligible employee.
  • This amount can include employer paid health Insurance.

2021

  • The Employee Retention Credit provides for a fully refundable tax credit equal to 70% of qualified wages (including qualified health plan expenses) paid between 01/01/2021 and 06/30/2021. The maximum amount of qualified wages taken into account for each employee is $10,000.00 (for the quarter) which makes the maximum tax credit $7,000.00 ($10,000.00 x 70%) per employee (for each quarter), $14,000 per employee (for the year).
  • This amount can include employer paid health Insurance.

Date editted: 01-11-21

myPay Solutions has added a 7200 Worksheet to assist you with completing the form.

Form 7200 Worksheet - COVID-19 custom report

  • A new report to assist clients in completing the Small Business Administration (SBA) loan forgiveness application is now available within the myPay Solutions Direct application.
    • To run the Paycheck Protection Program Loan Forgiveness Worksheet, log into your secure portal, select Applications and open the myPay Solutions Direct application.
    • Once the program opens, choose Print Reports from the menu on the left, and select the report titled Paycheck Protection Program Loan Forgiveness Worksheet. Show me.
      PPP Forgiveness Report
    • Select the appropriate date range based on your needs.
    • To get the information required on the application, you will need to run this report multiple times using various date ranges, all of which are specified in the SBA application instructions.
  • For detailed information about Report contents and calculations what the contains click here to Show me.

    Section headings

    The Paycheck Protection Program Loan Forgiveness Worksheet includes sections that correlate to those on the loan forgiveness application. If a section doesn't apply to your business, it won't display on the report.

    • Employee compensation of less than or equal to $XX,XXX.XX for the XX week time period. Use the information in this section to fill out Table 1 of the loan forgiveness application. This table requires you to enter information for employees who were paid an annualized rate of less than, or equal to the cap of $100,000.00 for all pay periods in 2019.
    • Employee compensation capped at $XX,XXX.XX for the XX week period. Use the information in this section to fill out Table 2 of the loan forgiveness application. This table requires you to enter information for employees who were paid an annualized rate of more than the cap of $100,000.00 for all pay periods in 2019.
    • Employer paid contributions and state/local taxes. This optional section lists the employer contributions and employer paid state and local taxes for the reporting period. If you include this information when you run the report for the PPP loan coverage period or the alternate loan coverage period, it could help complete the Non-Cash Compensation Payroll Costs During the Covered Period or the Alternative Payroll Covered Period section of the SBA loan forgiveness application.

    Columns

    • Cash Compensation. This column displays the employees' gross pay, excluding leave covered by the Families First Coronavirus Response Act (COVID-19 self care, other care, and extended child care).
    • Average Full-time employee (FTE) calculations. For each employee, the average number of hours paid per week in the report date range is divided by 40. This is capped at 1.0 where average hours is over 40.
    • Simplified Average Full-time employee (FTE) calculations. This is the calculation used in the instructions for the SBA loan forgiveness application.
      • 1.0 - The employee's average number of hours paid per week in the report date range is 40 or greater
      • 0.5 - The employee's average number of hours paid per week in that date range is greater than 0 but less than 40

    Standard hours vs Actual hours

    The Paycheck Protection Program Loan Forgiveness Worksheet assumes that an employee worked standard hours if all of the following conditions are true.

    • The employee used a pay item with a Salaried amount calculation type.
    • The Salaried amount pay item has an amount associated with it on the payroll check.
    • The Salaried amount pay item has 0 regular hours recorded on the payroll check.

    If one or more of those conditions are not true, the Paycheck Protection Program Loan Forgiveness Worksheet uses the actual hours as recorded on the payroll check.

  • President Trump Signs Paycheck Protection Program Flexibility Act: On 6/5/20, President Trump signed the Paycheck Protection Program Flexibility Act (PPPFA) of 2020 (H.R. 7010), which modifies provisions related to the forgiveness of loans made to small businesses under the PPP. The PPPFA (1) eliminates a CARES Act provision that prevented certain PPP participants from deferring the payment of payroll taxes; (2) requires borrowers to use at least 60% (rather than the original 75%) of PPP funds on payroll costs; (3) gives borrowers 24 weeks (rather than the original eight weeks) to spend PPP funds; (4) pushes back the original 6/30/20 deadline to rehire workers to 12/31/20; (5) provides additional exceptions if a borrower is unable to rehire the required number of employees; and (6) extends the minimum maturity date of the loan (for proceeds that are not forgiven) to five years. The full legislative text of the bill is available at www.congress.gov/bill/116th-congress/house-bill/7010/text
  • Use the Treasury’s website to obtain the latest guidance or to apply for forgiveness of your PPP Loan if you qualify: U.S. Dept of Treasury PPP Website
  • myPay Solutions has a report available that can help you complete your PPP Loan Forgiveness Application within the myPay Solutions Direct application. It can be found under Reports > Paycheck Protection Program Loan Forgiveness Worksheet.
  • If you need to update your bank information due to an account linked to a PPP loan you received, please reference these steps on how to change your information with myPay Solutions: Changing or Updating Your Company Bank Account
  • If you have questions about your application or qualification for loan forgiveness, you should consult with your accountant or loan provider.

The Coronavirus Aid, Relief, and Economic Security Act (CARES Act), enacted on March 27, 2020, is designed to encourage Eligible Employers to keep employees on their payroll, despite experiencing economic hardship related to COVID-19, with an employee retention tax credit under the Employee Retention Credit and access to a federal loan for payroll purposes under the Paycheck Protection Program.

  • The Paycheck Protection Program is part of the CARES Act that allows small business to potentially receive 100% federally guaranteed loans for payroll purposes.
  • Employers could be eligible for a loan of up to 2.5x to 3.5x of their average monthly payroll costs.
  • To get more details about a Paycheck Protection Program Loan and to see if your business qualifies, read the U.S. Chamber's Guide to Emergency Coronavirus Loans.
  • The SBA website contains a copy of the Application for a Paycheck Protection Program Loan.
  • You should consult your accountant or lender for further guidance if you have any questions about obtaining a Paycheck Protection Program Loan.

We do not have forecasting reports available within myPay Solutions Direct; however, we do have alternative reports available that can help you determine the average number of full-time employees or your payroll costs for a specified period.

  • You can run the myPay Cash Requirements and Deposits Report within myPay Solutions Direct to see what your actual payroll costs were for a specified period and use those historical numbers to determine what your future payroll costs might look like.
  • In order to determine the number of full-time employees for a specific time period (defined as 30 or more hours per week per ACA guidelines) you can run the Average Fulltime Employee Worksheet Report within myPay Solutions Direct.
  • Both reports can be found within your myPay Solutions Direct application. Once you have launched the application, click on Print Reports from the menu on the left and choose a report from the list. Show me.
    PPP Cost Reports

Internal: If neither of these reports work for your client or RA, there is another option that you can walk them through to get updated numbers based on their current payroll situation.

  • You can explain how to create an On Demand payroll batch using myPay Solutions Direct. This will allow the client to enter different scenarios and use the preview payroll option to view the cash required. We are not providing this as a first option due to the risk of the client unintentionally submitting a payroll. Be sure to caution the client about this and recommend they always cancel the batch.
  • This option also has some limitations if they are using multiple payroll items and may require additional instruction if they want to run different scenarios based on hours worked.
  • Link to On Demand payroll: https://cs.thomsonreuters.com/ua/acct_pr/mypay_client/cs_us_en/topics/z_create_on_demand_payroll_dlg.htm
  • In order to change the bank account information for any account that funds your payroll, please contact your Payroll Specialist directly. They will send you the bank account change form to complete and request that you provide either a copy of a voided check, a bank statement, or an online screen shot specifying the routing number, account number, account type and name on the account.
  • Upload your completed bank account change form and accompanying bank documentation to File Exchange for your specialist to take action. We cannot accept banking information via e-mail or over the phone.
  • Internal: Click below to download a full email template that you can send to your client if they are requesting to update their funding bank account. You will need to copy the Word document and paste it into your myPay Solutions email. Remember to personalize that attached bank account change form for the client first before sending them the email template and form: Bank Account Change Outlook Email Template.
  • Internal: Click here for a blank copy of the bank change form that you can personalize by first adding their client ID and name as it is in EMS/SBPR, and indicating whether the client or accountant pays fees and then send to your client to complete the rest and return via File Exchange: Bank Change Form
  • Internal: See our internal HHTC article about how to handle bank account change requests: https://cs.thomsonreuters.com/ua/acct_pr/mypay_client/cs_us_en/payroll_specialists_internal/internal-bank-account-changes.htm
  1. The employer’s business is fully or partially suspended by government order due to COVID-19 during the calendar year.
  2. The employer's gross receipts (sales) are below 50% of the comparable quarter in 2019. Once the employer's gross receipts go above 80% of a comparable quarter in 2019, they no longer qualify after the end of that quarter.
    • This calculation is on a quarter by quarter basis.
    • The determination of eligibility for first quarter 2019 allows for the credit to be taken in second quarter 2020.
    • It is expected to have the second quarter 941 to have a line to reflect this credit.
    • Once the employer’s gross receipts (sales) go above 80% of comparable of the quarter in 2019 the credit is no longer able to take after the end of the current quarter.

Example: Accountant and Client determine employer’s gross receipts (sales) in Quarter 1, 2019 were 50,000. Quarter 1, 2020 gross sales were 22,500 the client would be eligible to take the credit in Quarter 2, 2020 ($22,500 divided by $50,000 = 45%).

Example: Accountant and Client determine employer’s gross receipts (sales) in Quarter 3, 2019 were 50,000. Quarter 3, 2020 gross sales were 62,500 the client would not be eligible to take the credit in Quarter 4, 2020 ($62,500 divided by $50,000 = 1.25%).

Qualification – Wage Determination

Qualifying wages are based on the average number of a business's employees in 2019. This falls into two separate categories:

  1. Employers with less than 100 employees: If the employer had 100 or fewer employees on average in 2019, the credit is based on wages paid to all employees, regardless if they worked or not. If the employees worked full time and were paid for full time work, the employer still receives the credit.

    Example: If an employer has 89 employees in which 75 of the employees are being paid wages but are not actively working and 14 of them are being paid for active work being conducted, all 89 employees would be eligible to be included in calculating qualifying wages.

  2. Employers with more than 100 employees: If the employer had more than 100 employees on average in 2019, then the credit is allowed only for wages paid to employees who did not work during the calendar quarter.

    Example: If an employer has 125 employees in which 100 of the employees are being paid wages but are not actively working and 25 of them are being paid for active work being conducted, only the 100 employees would be eligible to be included in calculating qualifying wages.

  • Only active employees who are being paid in the quarter are eligible for the credit up to the $5,000 cap.
  • Yes and No. The IRS has since clarified their guidance on this question.
  • YES if...

    An employer that applied for a PPP loan, received payment, and repays the loan by May 7, 2020 (in accordance with the Limited Safe Harbor With Respect to Certification Concerning Need for PPP Loan Request in the Interim Final Rules issued by the Small Business Administration effective on April 28, 2020) will be treated as though the employer had not received a covered loan under the PPP for purposes of the Employee Retention Credit. Therefore, the employer will be eligible for the credit if the employer is otherwise an Eligible Employer.  For more information, see Business Loan Program Temporary Changes; Paycheck Protection Program—Requirements—Promissory Notes, Authorizations, Affiliation, and Eligibility (PDF).

  • NO if...

    An Eligible Employer may not receive the Employee Retention Credit if the Eligible Employer receives a Small Business Interruption Loan under the Paycheck Protection Program that is authorized under the CARES Act (“Paycheck Protection Loan”). An Eligible Employer that receives a paycheck protection loan should not claim Employee Retention Credits.

Source: IRS - https://www.irs.gov/newsroom/faqs-employee-retention-credit-under-the-cares-act

  1. The Specialist downloads and personalizes the Tax Payment Deferral Waiver – CARES Act for the client that is requesting it. This waiver will be attached to an email template and sent to the client to sign.
  2. The Specialist sends the templated email to their client with personalized Tax Waiver attached.
  3. Once the client returns the signed Tax Waiver, the Specialist will log it in FileCabinet under the Client Tax Information 2020 folder.
  4. The Specialist next sends an email to the Supervisor Inbox with the following information:
    1. Subject: Action Required - Elect ER SS Tax Deferral
    2. Include the client ID and check date
    3. The supervisor will confirm that the signed document is logged in FileCabinet.
    4. The supervisor will go into SBPR - Custom Fields Tab and enter the first payroll date that this deferral will take effect under the ELect ER SS Tax Deferral. This should match the date on the Tax Waiver. The Defer payment of ERFICA-SS to the end of 2021 and 2022 box will also need to be marked on the COVID-19 Acts Tab.
    5. The Supervisor will reply to the Specialist’s email letting them know its approved.
    6. When the Specialist is ready to CPO the payroll, they will then forward their approved email to MPS Banking and CC Maren. The CPO must be done at least 30 min. prior to the batching windows at 11:00am and 4:00pm to ensure banking has time to remove the necessary files.
  • In these instances we will open a document presentation only portal for the client to obtain old data or access a copy of a PPP report. The payroll specialist will need to run the report for the client to obtain from their doc pres folder.
  • Before submitting any requests: Verify if anyone (client or RA) has access still - some termed clients may be still active.
  • Submit a portal request template internally requesting document presentation access. As long as they are the same person with the same email address as we show on file, no portal request form is needed from the client.
  • On your internal portal request, note in the notes COVID 19 PPP LOAN.
  • We can only provide this access to one of the following contacts, using the email address we show on file for them:
    • RA
    • Owner / Executive
    • Payroll Admin
    • Secondary Payroll Admin
  • The client will receive access to document presentation.
  • If the PPP report is needed, the specialist would need to run the report for the client and put it out in doc pres folder for the client.

Families First Coronavirus Response Act (FFCRA)

If your business is filing IRS Form 7200, here is what we need from you - please contact your Payroll Specialist ASAP:

  • Your company used Form 7200 to expedite a federal tax refund due to the aforementioned tax credits, please forward a copy of the completed Form 7200 to your Payroll Specialist BEFORE July 15th 2020, so we can ensure that your Q2-2020 941 return is compliant.
  • Your company paid out any qualified health plan expense amounts related to FFCRA COVID-19 wages during the 2nd Quarter. These can be listed for additional credit. (Note: Employee Retention Credit limit includes the health plan expense amount). If you have qualifying credits, and have not already reported them to your Payroll Specialist, please report them now so they can be accurately reflected on your return.

Both or either of these credits if applicable to you, MUST be reported to your myPay Solutions Payroll Specialist, no later than July 15th 2020.

The Family First Coronavirus Response Act (FFCRA) along with the Coronavirus Aid, Relief, and Economic Security Act (CARES ACT) provided much needed relief for many businesses in the form of qualified sick and qualified family leave wages, along with Employee Retention Credits.

In addition, Form 7200 provided the vehicle to request advance payment of tax credits that are claimed on form 941, the Employer’s Quarterly Federal Tax Return, much sooner than waiting for the quarterly return to be filed, accepted and any credits being refunded.

  • The FFCRA provided for expansions to Paid Sick Leave under Expanded Family and Medical Leave (EFMLA) and Emergency Paid Sick Leave (EPSL) for COVID-19 related reasons.
  • The FFCRA provides eligible businesses with a refundable payroll tax credit that reimburses them dollar-for-dollar for the cost of providing Coronavirus-related leave to their employees. The credit can be applied against any 941 liabilities including Employee and Employer paid Social Security and Medicare taxes in addition to Federal Withholding.

Visit this page to see how your payroll specialist can set up accruable benefit tracking for COVID-19 leave: Tracking COVID-19 Sick Leave

Payroll special item types

  • COVID – 19 Extended Child Care
  • COVID – 19 Other Care
  • COVID – 19 Self Care

Payroll Journal report

Once the above payroll item types are used on a live payroll they will show on in the following ways:

  • As a pay item on each Employee individual check that used the item for that payroll. Show me.
    COVID Reports PR Journal 1
  • As a pay item on the company totals page summarizing the total amount used for that payroll. Show me.
    COVID Reports PR Journal Co Totals

Cash Requirements and Deposits report

There are no changes to the Cash Requirements and Deposits Report as Development is anticipating the variables to be updated soon.

  • The tax liability will be reduced by the FICA-SS employer amount.
  • If a credit forward is available, it will not reflect here either. Show me.
    COVID Reports Cash Reqs Report

Depository Totals report

There are no changes to the Depository Totals Report as Development is anticipating the variables to be updated soon.

  • The tax liability will be reduced by the FICA-SS employer amount.
  • If a credit forward is available, it will not reflect here either. Show me.
    COVID Reports Depository Totals report

Tax Deposit report

  • This report will show the carry over amount the client has available for the next payroll.
  • If your client is asking for these Payroll Items to be setup add this report to their report profile to allow them to see the carry over. Show me.
    COVID Reports Tax Deposit report
  • Employers will be able to claim a payroll tax credit for wages paid for both the Expanded Family and Medical Leave and Emergency Paid Sick Leave.
  • A dollar for dollar credit is provided for Coronavirus-related sick leave and paid FMLA wages against the 941 tax liabilities (Employee and Employer paid Social Security and Medicare taxes in addition to Federal Withholding).
  • Employers will be able to claim these credits based on qualifying leave they provide between April 1, 2020 and December 31, 2020. Leave benefits and payroll credits will not be retroactive.
  • The IRS has released Form 7200 for employers to use to apply for payroll tax credits or anticipated refunds under the FFCRA.

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Tags

C-19, Coronavirus, ERC

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