Some senators want the chamber to approve next week a House-passed bill (H.R. 7010) that would extend the CARES Act Paycheck Protection Program (PPP) loan forgiveness covered period from eight weeks to 24 weeks and require that 60% of funds be used for payroll expenses, rather than 75% currently. A Senate bill (S. 3833) would extend the period to 16 weeks and not change the payroll requirement, but the House vote was an overwhelming 417-1 and the Wall Street Journal cited Senate Democratic leader Chuck Schumer (D-NY) and Senator Angus King (I-ME) as those pushing for the Senate to follow suit.

However, Senator Marco Rubio (R-FL), a leader on the issue, tweeted that he is asking Treasury officials how they would interpret the House bill's reduced payroll requirement and relaxing of rehiring requirements, which he has concerns about.

A New York Times story considers the consequences of the PPP program ending if Congress doesn't replenish it and the expiration of expanded unemployment benefits in July — or even the possibility that such aid expires — as "President Trump and other Republicans have played down the need for more spending." The story quoted Senate Majority Leader Mitch McConnell (R-KY) as saying at an event May 28, "I think about a month from now, we'll take a look at how things are going and be able to make a more intelligent decision than a grab-bag of $3 trillion," referring to the House-passed HEROES Act.

Asked during her regular news conference May 28 about the prospect that bipartisan negotiations on a next bill won't happen until either the $600 UI add-on comes up for renewal or until the PPP runs out of money again, House Speaker Nancy Pelosi (D-CA) said "our health care workers, our first responders, so many people are risking their lives to save lives, and now they'll lose their jobs because their state and local governments and county governments, which provide some of the health care, just don't have the money to — they're either going to have to fire people, reduce services, raise taxes or all of the above." Of Republicans coming to the negotiating table, she said, "I think they'll catch the spark. Their tone is changing, as I think you've probably noticed."

House Ways and Means Committee Ranking Member Kevin Brady (R-TX) was on CNBC's "Squawk Box" May 29 to talk about how to help Americans get back to work through a "return to work" bonus. "We think a return to work bonus — that allows workers to keep $1,200, two weeks of their unemployment — for taking that job that they just left makes good economic sense," he said.

On scheduling, the Senate is returning to session next week, but the House is not planning to hold votes. "In the coming weeks, as result of the House adopting a resolution to allow the committees to work remotely, committees will be at work on critical pieces of legislation," Majority Leader Steny Hoyer (D-MD) said in guidance on the House schedule. "As committees move forward with hearings and markups of important legislation, including NDAA, FY '21 Appropriations, Surface Transportation Reauthorization, and WRDA, further information will be provided regarding Floor consideration of any of these must-pass measures as soon as it becomes available."

One item of House business next week is an Appropriations Subcommittee on Labor, Health and Human Services, Education, and Related Agencies hearing June 4 (at 11 a.m.) on COVID-19 Response with the CDC's Robert Redfield.

Implementation

On May 28, the IRS issued Notice 2020-35, which postpones deadlines for certain specified time-sensitive actions with respect to certain employment taxes, employee benefit plans, exempt organizations, and Coverdell education savings accounts on account of the ongoing COVID-19 pandemic. The notice also provides a temporary waiver of the requirement for a Certified Professional Employer Organization to file certain employment tax returns and their accompanying schedules electronically.

Also May 28, Treasury and IRS issued proposed regulations to help businesses understand how legislation passed in 2018 may benefit those claiming carbon capture credits.

EY Alerts and other resources are here.

The global EY Tax COVID-19 Response Tracker has been updated through May 28.

An EY Webcast, "Tax in the time of COVID-19: What's new and notable in tax credits, refunds and at the IRS," is today, May 29 at 12:00 p.m. ET. Events like the spread of the coronavirus (COVID-19) have made reacting to trade disputes and continued implementation of the Tax Cuts and Jobs Act much more difficult. After a review of the legislative and economic landscape, this week's panelists will explore: (i) bonus depreciation (qualified improvement property), Alternative Minimum Tax Credit refunds and Section 165(i); (ii) the Employee Retention Credit; (iii) IRS operations and guidance; and (iv) any breaking developments. Register.

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