The Main Street Small Business Tax Credit II will provide COVID-19 financial relief to qualified small business employers. Beginning November 1, 2021, and ending November 30, 2021, the California Department of Tax and Fee Administration (CDTFA) will be accepting applications through their online reservation system for qualified small business employers to reserve $1,000 per net increase in qualified employees, not to exceed $150,000.
Tentative credit reservation amounts will generally be reduced by credit amounts reserved or received under the first Main Street Small Business Tax Credit. The credits are reserved on a first-come, first-served basis. Qualified small businesses will be able to offset either their income taxes or their sales and use taxes with the credit when filing their returns.
The credit only applies to California small businesses that meet the following qualifications:
- Employed 500 or fewer employees as of December 31, 2020, and
- Experienced a decrease of 20 percent or more in income tax gross receipts by comparing specified periods.
For more information, feel free to contact Wheeler Accountants to see if this opportunity can benefit you and your eligible small business.