Employee Retention Credit
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.
What is the ERC?
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.
Cash for any business need
Refunds are most often received as a check from the US Treasury.
ERC wasn't widely used until recently
ERC has since undergone expansions and multiple amendments by Congress.
Designed to reward businesses
The program rewards those who kept employees on payroll in 2020 and 2021.
Established with the CARES Act
The same relief bill that created PPP loans also created the ERC.
ERC is underutilized, with most eligible businesses not claiming their refund
The IRS anticipates 70-80% of businesses are good candidates for taking the Employee Retention Credit.
It’s surprising to me of how unaware businesses are that these credits and refunds exist.
IRS Revenue Officer
The Internal Revenue Service urges employers to take advantage of the newly-extended employee retention credit...
Is my business eligible for 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 Many business owners are disqualifying themselves based on outdated information, sometimes from their own CPA.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.
ERC benefits start to expire in 2023
The government has defined a “small business” as:
*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.
Your small business is eligible for an ERC refund if it meets either of the following criteria:
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.
How much does my business qualify for?
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.
Check what your business is owed, for free
Your refund amount is based on many factors, including:
Number of employees
Group health premiums
Participation in other government programs
How do I file?
Time is running out, don’t miss out!
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.
We recommend working with professionals who focus on ERC.
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.
How Can ERC Together Help?
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 team have overseen thousands of claims, recovering over $100 million in ERC refunds for our clients.
File with confidence
Unlock every credit
Our ERC Team will work with you to maximize your ERC tax refund.
Professionals at your fingertips
Our team is here are here to guide you every step of the way.
Filing made easy
With 100+ payroll system integrations, finding the right documents is fast.
No hidden fees
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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