Small Business Tax Relief

“Main Street” Small Business Hiring Tax Credit

Qualified small businesses adversely impacted by COVID-19 can reserve tax credits for hiring full-time employees. There are a limited number of tax credits available, so be sure to reserve yours today.

Request Tax Credit Reservation

To qualify for the credit, taxpayers (employers) must:

  • Have 100 or fewer employees on December 31, 2019 (all employees, including part-time).
  • Have experienced a 50% decrease in gross receipts from April to June 2020, compared to the gross receipts in April to June 2019.
  • Apply for a tentative credit reservation from the California Department of Tax and Fee Administration (CDTFA) by Friday, January 15.

Learn more

Sales Tax Relief

There is also an automatic three-month tax extension for taxpayers filing less than $1 million in sales tax, an extension of existing interest and penalty-free payment agreements to companies with up to $5 million in taxable sales, and expanded interest-free payment options for larger businesses particularly affected by significant restrictions on operations based on COVID-19 transmissions.

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Additional Support

California has taken action during this unprecedented economic time to provide support for our small businesses. This includes:

  • Expanding eligibility for the California Earned Income Tax Credit (CalEITC) to self-employed and small business owners. 
  • Waiving $800 minimum franchise tax for small and medium-sized businesses during their first year of business creation.
  • Exempting Paycheck Protection Program (PPP) loans provided to California small businesses under the CARES Act.

View the complete list of supportive programs for California businesses here.

Learn more about:

California Rebuilding Fund

Small Business and Nonprofit COVID-19 Relief Grant