On December 10, 2020, Maryland Governor Hogan announced two new COVID-19 initiatives to provide economic relief to businesses in Maryland.
Emergency Unemployment Tax Relief For Businesses
The first Executive Order No. 20-12-10-01, effectively suspends unemployment tax increases for Maryland businesses for 2021.
The Order, which acknowledges “contributory employers cannot fairly be held responsible for the abnormally high volume of unemployment insurance claims caused by COVID-19,” maintains that the same benefit ratio used to calculate an employer’s 2020 tax rate will be used to calculate the tax rate for 2021. In other words, the 2020 fiscal year will be excluded from tax rate calculations and the rate will instead be based on fiscal years 2017, 2018 and 2019. This ensures that chargeable benefits paid to former employees from July 1, 2019 through June 30, 2020, will not impact 2021 rates.
According to the release from the Maryland Department of Labor, employers should be receiving a direct email about this information but do not need to take any steps at this time.
Forgiveness Of Emergency Loans
Additionally, the Governor announced that the State will forgive $75 million in emergency business loans, which will now be converted to grants. The loans were issued this past spring as part of a COVID-19 relief package.