What Plan Sponsors Need to Know About Layoffs and Partial Plan Terminations

Based on IRS rules, a partial plan termination can occur if approximately 20 percent or more of plan participants are terminated by the plan sponsor as a result of an action, such as a plant closure, a decision to downsize, or the termination of a product line. The reduction can accumulate over one or more plan years and still be classified as a partial termination.

CARES Act Aids Employers Who Continue To Pay Employees

The CARES Act provides two distinct and substantial employment tax benefits for certain employers under Sections 2301 and 2302 of the Act. Taken together, these provisions provide significant relief for employers and are designed to encourage employers to continue paying wages to employees during these unprecedented times.