Employee Retention Tax Credit: Supporting our financial recovery
As President Pollack and Provost Kotlikoff noted in their July 2 message, Cornell continues to pursue a number of avenues to alleviate some of the financial strains that we are experiencing due to the pandemic. One such example is a provision of the federal CARES Act which provides a tax credit for eligible employers to encourage them to continue paying employees during the crisis.
The Employee Retention Credit allows Cornell to claim a credit against applicable employment taxes and is a tax credit equal to 50% of qualified wages (including allocable qualified health plan expenses). The credit is determined quarterly and is capped at $5,000 per eligible employee. The credit applies to qualified wages paid between March 12, 2020 and January 1, 2021 and would be used by Cornell to help further offset projected budget deficits.
If you are (or were) either fully or partially unable to complete your duties due to the university’s response to the COVID-19 pandemic through no fault of you own (e.g., lack of access to worksite or duties that aren’t able to be performed remotely), and if you continued to receive your regular pay during this time, the university may be able to claim a tax credit for your wages.
To pursue this credit, the university needs to document and generate accurate information regarding the amount of wages paid to fully or partially idled exempt and non-exempt employees.
Here is what you can do to help:
- Non-exempt employees should continue to record any idle hours in Workday Time Off using the code of “Hours Not Worked - COVID-19.” You will be paid your full rate for these hours under separate earnings in your paycheck.
- Exempt employees (excluding faculty) are asked to record any idle partial or full days using the Workday Time Off functionality and selecting the time off plan of “Time Not Worked - COVID-19.” This time off plan may be used in less than half day increments to accurately reflect any idle time.
The recording of time, as reflected above, is purely for ease of identifying the correct wages to apply to the tax credit. Going forward, we ask that you begin to record any idle time through January 1, 2021. We also ask that you use your best efforts to record prior idle partial or full days dating back to March 12, to the extent practicable.
We thank you for being good financial stewards throughout these trying times and for accurately recording your idle hours to further support our financial recovery.
If you have any questions, please contact your supervisor and/or local Human Resources Office.
Mary G. Opperman
Vice President and Chief Human Resources Officer
Joel M. Malina
Vice President for University Relations