A bill to provide tax relief for the victims of Hurricane Florence, Hurricane Michael, and certain California wildfires was introduced in the current lame duck session of the 115th Congress. This bill expands upon the previously presented Hurricane Florence Tax Relief Act bill to address the additional recent natural disasters, and signals the importance of addressing the disasters to the Senators of impacted states.
The bill includes an employee retention credit offering businesses in the respective disaster zones a credit of 40% up to $6,000 in wages paid to employees during periods of disaster-related inoperability and until the business is able to resume significant operations. Because of the specific dates of eligibility for each disaster, the details of eligible wage requirements, and the fact that employee wages used for these disaster credits would not be eligible the Work Opportunity Tax Credit, it is important to work with First Advantage as well as your tax advisor or legal counsel, to ensure that requirements are met and wages are allocated appropriately for your specific circumstance.
Given the timeliness of the issue, it is likely that the Senators who introduced the bill will be working to pass the legislation as soon as possible. First Advantage will continue to monitor its advancement and keep you informed. We will assess whether this new credit would be available to your business, and your First Advantage Tax Account Manager is happy to answer any questions you may have on this bill or any other incentive programs.