AccountMate Payroll Tax Update for the American Rescue Plan (ARP) Act of 2021

The ARP Act of 2021 provides eligible employers with tax credits to cover certain costs of providing employees with paid sick and family leave for specified reasons related to COVID-19.

Eligible employers may claim tax credits for qualified leave wages (plus allocable qualified health plan expenses, certain collectively bargained contributions, and the employer’s share of social security and Medicare taxes imposed on the qualified leave wages) paid with respect to leave taken by employees beginning on April 1, 2021, through September 30, 2021. Of course, consult your tax accountant on the applicability and implementation of ARP for your specific business.

The American Rescue Plan (ARP) Act of 2021 Enhancement for AccountMate allows companies that have the PR Tax Subscription Program to record and track COVID-19-related earnings and tax credit claims.

Note: You don’t need to add the ARP enhancement if you don’t need to track COVID-19-related paid leave and earnings paid from April 1, 2021 through September 20, 2021. You can update the PR Tax Subscription anytime as usual without having the ARP enhancement package installed in your AccountMate system.

Installation of the ARP Enhancement requires a few steps:

  • Installation of the COVID Tax Relief (FFCRA and Cares Act – 2020) enhancement. If you’re running AccountMate 12 for SQL/Express and higher, it’s already included/installed.
  • Installation of the American Rescue Plan (ARP) Act of 2021 Enhancement package that’s specific to your AccountMate version.
  • Updating the PR Tax Subscription Program if it’s not already at Version #2020.10 or later.
  • An updated Recalculate Employer FICA Utility is available with the enhancement.

Installation time is invoiced but it won’t take us long at all to do it, so reach out to us to schedule your update if you’ll need to track any earnings under the ARP act.