Learn more about the tax credit of up to $26,000 per employee for businesses that kept employees on payroll during the pandemic.
As a small to medium-sized business, it’s likely that you were negatively impacted by COVID-19, and you certainly weren’t alone.
Due to financial suffering across the country, Congress passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act to help get businesses back on their feet — with a special section called the Employee Retention Credit (ERC), specifically added to help businesses like yours.
The Employee Retention Credit (ERC) was developed to encourage and support employers who retained existing employees throughout 2020 and for the first three quarters of 2021 by offering a generous payroll tax refund through the IRS.Eligible businesses could receive a refund of up to $5,000 per employee for all of 2020 and up to $7,000 per employee kept on the payroll for each quarter for Q1 through Q3 of 2021. That’s a total refund of up to $26,000 per employee kept on your payroll.
Refunds are most often received as a check from the US Treasury.
ERC has since undergone expansions and multiple amendments by Congress.
The program rewards those who kept employees on payroll in 2020 and 2021.
The same relief bill that created PPP loans also created the ERC.
Most small and medium-sized businesses qualify. Many business owners are disqualifying themselves based on outdated information, sometimes from their own CPA.
The ERC is related to your payroll, not your business income tax returns, which is what most CPAs handle. Meaning, this credit has mostly fallen into an area where few CPAs are able to effectively process it.
Additionally, ERC qualifications and limitations have been amended by Congress many times since the initial rollout of the Employee Retention Credit. With over 200 pages of complex ERC tax code, it’s no wonder that not every CPA fully understands the program. We recommend working with an ERC specialist that can provide you with updated information and help you get the full refund amounts that you deserve.
*Any employer that operates a trade, business, or a tax-exempt organization. This was expanded for the ERC 2021 to include some governmental employers.
*Having fewer than 100 full-time employees (calculated from 2019) for the 2020 ERC refund.
*Having fewer than 500 full-time employees (calculated from 2019) for the 2021 ERC refund.
Experienced a significant decline in gross receipts during the 2021 calendar quarter, more than a 20% decline versus the same quarter of 2019 and a 50% decline in the 2020 calendar.
Had operations that were impacted due to government orders due to COVID-19, resulting in limitations of commerce, travel, or meetings.
If your business was impacted due to a government order that caused one or more of the following, you may qualify:
*Your business operations were interrupted.
*There were interruptions with your supply chain.
*There was an inability to access equipment.
*Your business had a limited capacity to operate.
*You were unable to work with your vendors.
*Your hours of operation were reduced.
*Your available services offered to customers were limited or reduced.
Even if your business and your tax advisor looked into ERC before, we urge you to review it again.
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Calculate your Employee Retention Credit
Determining the exact amount that your business is owed is a complex accounting process. Though these are payroll tax credits, what you’ve paid in payroll tax isn’t the only factor in your ERC calculations.
Your refund amount is based on many factors, including:
The maximum value a business is able to claim starts to decrease in
2023, and gets smaller each quarter.
Since qualifications and limitations have been recently amended, you don’t want to miss your chance. As more small businesses discover the ERC, the processing times may increase. The best way to to make
sure your business gets what it is is owed is to get started today.
Getting your amended payroll tax returns prepared and filed by inexperienced providers could result in a reduced tax refund, rejected amended payroll tax returns, or the need to revise and refile your amended payroll tax returns, prolonging the process. Your tax provider needs to be up to date on all ERC-related legislation, so they may maximize the available ERC and avoid mistakes that could cost your business part (or even all) of the ERC tax refund.
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Get your business the money it is entitled to.
Our streamlined end-to-end ERC process simplifies the complex process of seeking an
ERC. We’re here to support you through the whole process, from eligibility to receiving the
ERC tax funds.
ERC is what we do. Our experienced tax attorneys and CPAs have overseen thousands
of claims, recovering over $1 billion in ERC
refunds for our clients.
Our ERC Tax Attorneys or CPAs will work with you to maximize your ERC tax refund.
Our team is here are here to guide you every step of the way.
With 100+ payroll system integrations, finding the right documents is fast.
We only collect a fee when your business gets a check from the Treasury.
With an average refund of $375,000, many of our clients have used their refund to
cover operating expenses, grow their business, hire talent, pay off debt, build a
safety net, and so much more.
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