The HEALS Act is a $1 trillion stimulus proposal designed to provide relief to businesses struggling in the ongoing COVID-19 pandemic. While the CARES Act provided initial assistance, many businesses are still facing financial challenges. The HEALS Act introduces additional measures, including loans, tax credits, and liability protections, to address these ongoing concerns and support economic recovery.

HEALS Act Extends the Paycheck Protection Program (PPP)

The Payroll Protection Program (PPP) was established to help small businesses impacted by the pandemic. Initially, the program distributed over $500 billion in forgivable loans, enabling businesses to pay employees and cover essential expenses. However, funding issues and misallocation to large companies caused controversy.

The HEALS Act addresses these concerns and proposes a second round of PPP funding. This round includes:

• $190 billion in combined leftover and new funds.
• Businesses must prove fewer than 300 employees and a 50% revenue loss to qualify.
• $100 billion allocated to seasonal businesses and businesses in low-income areas, offering long-term loans capped at $10 million with a low 1% interest rate.

This extension ensures that small businesses can secure additional funding to keep their doors open and retain employees.

HEALS Act Increases Employee Retention Tax Credits

The Employee Retention Tax Credit, originally created under the CARES Act, encourages businesses to retain employees despite revenue losses. This refundable tax credit previously covered 50% of qualified wages.

Under the HEALS Act, the tax credit will:

• Increase to 65% of qualified wages.
• Expand the wage limit to further support struggling employers.

This enhancement provides businesses with more incentive to retain employees during the pandemic.

HEALS Act Creates Tax Credit Incentives for Business Meals

Restaurants have been hit particularly hard by shutdowns and social distancing restrictions. Many establishments have closed permanently, while others struggle with reduced capacity, cleaning protocols, and fewer customers.

To support the restaurant industry, the HEALS Act proposes:

• A 100% tax deduction for business meals.

This incentive encourages businesses to provide meals for employees, boosting employee satisfaction, retention, and supporting restaurants’ recovery. Additionally, it benefits businesses during tax season by offering increased deductions.

HEALS Act Introduces a Tax Credit for Health and Safety Expenses

Ensuring a safe work environment during the pandemic has required businesses to spend significantly on health and safety measures. The HEALS Act provides relief through:

• A 50% refundable tax credit for costs such as COVID-19 testing, personal protective equipment (PPE), and enhanced cleaning protocols.
• Credit limits based on the number of employees:
  • $1,000 per employee for the first 500 employees.
  • $750 per employee for the next 500 employees.
  • $500 per employee beyond that.

This tax credit helps businesses cover critical health-related expenses and protect their workforce.

HEALS Act Offers a Liability Shield for Businesses

One of the major concerns for businesses reopening is liability for COVID-19 exposure. Despite enhanced cleaning and social distancing measures, businesses fear lawsuits related to virus outbreaks.

To address this, the HEALS Act includes:

• A 5-year liability shield for businesses, schools, universities, and hospitals.
• Plaintiffs must prove gross negligence and violations of public health guidelines to bring a successful lawsuit.
• Federal courts will have jurisdiction over COVID-19-related claims.

This liability shield provides essential protection for businesses as they work to reopen safely and minimize risks.

Call Boyer Law Firm for Assistance

If you’re interested in learning more about how the HEALS Act can benefit your business, or if you need assistance with PPP applications, tax credits, or liability concerns, Boyer Law Firm is here to help. Our firm can guide you through the application process and address any tax implications related to this stimulus proposal.

Contact us today to schedule a consultation and take advantage of the opportunities provided by the HEALS Act.