Wetzel’s Pretzels Franchise Employee Retention Credit

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Do you own or operate a Wetzel’s Pretzels franchise restaurant?

Wondering if your Wetzel’s Pretzels location qualifies for the Employee Retention Credit (ERC) due to negative impact of COVID during 2020 and 2021? 

As a Wetzel’s Pretzels franchisee, yes it does, and here is why.

Your Wetzel’s Pretzels restaurant still qualifies for the employee retention tax credit, depending on the mandated state government, county, city, or municipality restrictions placed on your location during the COVID pandemic. Even if your revenue increased during 2020 and 2021, vs. 2019, you still qualify.

If your Wetzel’s Pretzels franchise restaurant was forced to close your indoor dining room, or limit seating capacity indoors, or reduce your hours of operation at your Wetzel’s Pretzels location, this qualifies your Wetzel’s Pretzels restaurant location under the IRS Employee Retention Tax Credit (ERTC) “partial shutdown” rules. 

Meaning, your Wetzel’s Pretzels restaurant was allowed to still do delivery, carryout, or outdoor seating. Even if your location did not have to be fully shutdown. However, you were mandated to close your Wetzel’s Pretzels indoor dining, and / or reduce your hours of operation at your Wetzel’s Pretzels location

Under the IRS ERC rules and regulations, your Wetzel’s Pretzels business qualifies because your operations were disrupted due to government intervention by forcing you to reduce your business capacity. This qualifies your Wetzel’s Pretzels franchise for the ERC Credit and tax refund from the start date of government restrictions, to the end date when all restaurant capacity restrictions were lifted.

This is exciting news for all Wetzel’s Pretzels franchisees and owners to help offset and recoup costs from the negative impact of COVID on your restaurant.

Many Financial and Accounting Professionals, CPAs, Financial Planners, Advisors, and Attorneys are unknowingly advising their Wetzel’s Pretzels restaurant clients wrong because they do not fully understand all the Employee Retention Credit tax guidelines as they relate to restaurants and food service-type businesses.

Schedule Your Free Restaurant Employee Retention Credit Consultation to see if your Wetzel’s Pretzels franchise location qualifies for the ERC Refund.

Table of Contents

Background on Wetzel’s Pretzels Franchise Restaurant Owners and Franchisees

For Wetzel’s Pretzels franchisee owners, the average annual sales volume of a Wetzel’s Pretzels franchise restaurant location in 2021 was $702,000.

Wetzel’s Pretzels restaurant franchises overall generated $219,000,000 in revenue from 300 locations.

This increased from the previous year by 7.

Overall, Wetzel’s Pretzels corporate has a total of 34 company units added to the 300 franchise units, for a combined total of 351 restaurant location units company-wide. 

Visit the Wetzel’s Pretzels company website at Wetzels.com.

Image Credit: © Petro / 123RF.com, Licensed for Editorial Use.

Wetzel’s Pretzels Employee Retention Credit For Franchise Restaurants

Wetzel’s Pretzels franchisee owners are not alone. The restaurant industry continues to struggle with the economic impact of the COVID pandemic, high inflation, and a possible recession. Wetzel’s Pretzels restaurant owners are looking for ways to support their Wetzel’s Pretzels employees and keep their businesses afloat, especially Wetzel’s Pretzels franchise restaurant owners who have a healthy investment in franchise fees and other expenses to recoup and earn a return from owning a Wetzel’s Pretzels restaurant.

The Employee Retention Credit (ERC) or Employee Retention Tax Credit (ERTC) was established by the Coronavirus Aid, Relief, and Economic Security (CARES) Act to help restaurant and food service type business employers retain their staff during economic hardship and negative impact due to COVID.

The Internal Revenue Service (IRS) ERC Tax Refund program is an important tool for restaurateurs, restaurant owners, principals, and employers. The ERTC offers tax relief and provides a financial incentive to retain employees during the past economic disruption that occurred during 2020 and 2021. 

For Wetzel’s Pretzels owners, having a thorough understanding of the ERC credit and how it applies to their Wetzel’s Pretzels restaurant franchise, owners and principals can ensure they take full advantage of this tax credit to support their Wetzel’s Pretzels employees and locations.

Here is how Wetzel’s Pretzels restaurant owners and principals can take advantage of this valuable IRS tax credit to help their Wetzel’s Pretzels location stay open with positive cash-flow to continue keeping their W-2 employees on the payroll.

Employee Retention Tax Credit For Wetzel’s Pretzels Restaurant Owners

The Employee Retention Credit for Wetzel’s Pretzels restaurants is a tax credit available to eligible Wetzel’s Pretzels restaurants and other food service businesses. It provides restaurant employers with a federal income tax credit of up to $26,000 per employee for wages paid during the pandemic years of 2020 and 2021. 

This tax incentive is intended to help reduce the financial burden of having retained Wetzel’s Pretzels employees who may otherwise have been laid off or suspended due to the economic downturn caused by the pandemic.

The ERC applies to gross wages paid to your Wetzel’s Pretzels franchise employees between March 13, 2020 and September 30, 2021, only for each quarter during this time frame that may have qualified. 3/13/20 to 9/30/21 time frame is for Wetzel’s Pretzels franchises that were in existence prior to COVID. 

For Wetzel’s Pretzels locations that opened after February 15, 2020, this restaurant is considered a recovery start-up business, and may qualify through December 31, 2021 (12/31/21) of the 4th quarter.

Qualified Wetzel’s Pretzels restaurants in 2020 can claim up to $5,000 maximum per employee for all of 2020. This is based on up to 50% of a Wetzel’s Pretzels employee’s qualified wages. Eligible Wetzel’s Pretzels employers must also have experienced either a full or partial shutdown due to orders, OR a capacity restriction from a governmental authority, OR have experienced a significant decline in gross receipts compared with the same quarter in 2019.

Almost every state forced Wetzel’s Pretzels restaurants to close their indoor dining, and / or limited their interior seating capacity. These periods of time occurred in which state, county, and city your Wetzel’s Pretzels restaurant is located, will qualify the quarters and periods of time the capacity restrictions were imposed on your Wetzel’s Pretzels location.For all of 2020, Wetzel’s Pretzels employers can access up to $5,000 maximum for eligible employees, and up to $7,000 per quarter, per employee, for eligible employees (for each quarter) in 2021. This means up to a combined $26,000 to $33,000 per employee depending on certain factors.

For Wetzel’s Pretzels Restaurants, What Are The Eligibility Requirements For The Employee Retention Credit?

To qualify for the ERC, Wetzel’s Pretzels restaurants must have experienced a full or partial suspension of their operations due to orders from a governmental authority limiting their ability to operate during specific periods in 2020 due to the pandemic.

Another way to qualify is if your Wetzel’s Pretzels restaurant had experienced a significant decline in gross receipts of at least 50% in 2020, or 20% in 2021, compared to the same calendar quarter in 2019, a pre-COVID year for your Wetzel’s Pretzels franchise. 2020 vs. 2019 and 2021 vs. 2019, quarter by quarter. 

If you had less than 100 Wetzel’s Pretzels employees paid in any given quarter in 2020 that qualifies, then all gross wages are counted, whether the employee was full-time or part-time.

In 2021, if your Wetzel’s Pretzels restaurant had less than 500 employees paid in any given quarter in 2021 that qualifies, then all gross wages are counted, whether the employee was full-time or part-time working for your Wetzel’s Pretzels franchise.

The Internal Revenue Service (IRS) provides the following specific restaurant examples to explain “full or partial closure orders” during a calendar quarter:

Social Distancing Through Capacity Restrictions at Your Wetzel’s Pretzels Location

It appears that government orders restricting the spacing of tables or limiting seating at your Wetzel’s Pretzels has more than a nominal impact on the restaurant’s business operations under the facts and circumstances.

Wetzel’s Pretzels Dining Is Closed Indoors, But Open Outdoors or for Wetzel’s Pretzels Delivery

Following the order, the Wetzel’s Pretzels restaurant can operate only its outdoor sit-down and carry-out service during this period. Since, under the circumstances, a significant portion of the Wetzel’s Pretzels restaurant’s business operations, its indoor dining service, has been closed by a government order, the Wetzel’s Pretzels restaurant’s business operations are partially suspended.

Wetzel’s Pretzels Restaurants All Interior Dining Rooms Are Closed

Due to a government order closing all restaurants, bars, and similar food service establishments for sit-down service (indoor dining), a Wetzel’s Pretzels restaurant must close its on-site dining area.

Wetzel’s Pretzels restaurants that qualify for the ERC can receive a tax refund cash incentive equal to a percentage of qualified gross wages paid:

  • Services and other gatherings were restricted by government orders; or

There was a significant decline in gross receipts for these Wetzel’s Pretzels restaurants.

What If My Wetzel’s Pretzels Restaurant Received a Paycheck Protection Program (PPP) Loan?

Good news Wetzel’s Pretzels owners!

Due to recent changes in the ERC program, there are still ERC refund benefits available to organizations and Wetzel’s Pretzels owners that have previously received PPP Loans, Restaurant Revitalization Funds (RRF), or Shuttered Venue Operator Grants.

The Wetzel’s Pretzels PPP Loan (or loans), if your Wetzel’s Pretzels location received two PPP loans, just needs to be correctly subtracted out from the date it was received against the qualified gross wages paid to your employees at Wetzel’s Pretzels.Besides Wetzel’s Pretzels franchises, there are many more types of restaurants that are eligible for the ERC credit. If your business serves any type of food similar to Wetzel’s Pretzels, you are probably eligible.

How Wetzel’s Pretzels Franchisees Can Claim The Employee Retention Tax Credit?

Once your Wetzel’s Pretzels franchise restaurant location has met all the eligibility requirements for the Employee Retention Credit, you can claim it on IRS Form 941-X

It seems simple enough, however, the ERC Credit is highly confusing and complex when dealing with the ERC program. 

See If Your Wetzel’s Pretzels Restaurant Qualifies For The ERC Credit. Schedule Your Free ERC Tax Refund Consultation For Expert Help In Claiming The ERTC Credit For Your Wetzel’s Pretzels Franchise.

When dealing with IRS tax matters, federal payroll taxes, income taxes, tax returns and other matters before the IRS, it’s always best to have expert help to stay safe and compliant.

Additionally, you should keep all your Wetzel’s Pretzels records and supporting documents in case the IRS has any questions. As a restaurant employer, understanding and meeting the expectations of the Employee Retention Credit For Franchise Restaurants is critical to taking advantage of the available tax credits.

Most importantly, Wetzel’s Pretzels employers must accurately calculate the ERC Credit amount, provide the necessary documentation to support their ERC claim, and ensure they comply with all relevant laws. Wetzel’s Pretzels employers are also responsible for keeping accurate records of their employee’s wages and hours worked.

You can also check out the detailed guide on How to Claim the Employee Retention Credit (ERC)?

Is The Employee Retention Tax Credit Only For Wetzel’s Pretzels Restaurants?

No, the employee retention tax credit is not only for Wetzel’s Pretzels restaurants. The Employee Retention Tax Credit (ERTC) was created as part of the Coronavirus Aid, Relief and Economic Security (CARES) Act to support business owners and Wetzel’s Pretzels franchisees who have been affected by the Coronavirus pandemic.

This tax credit is available to all businesses regardless of size or industry, so restaurant employees are not the only ones eligible for this benefit. 

To qualify for these tax benefits, Wetzel’s Pretzels employers must demonstrate that they experienced either a full or partial suspension of business operations due to governmental orders related to COVID-19 or had significant revenue losses due to the virus.

Besides Wetzel’s Pretzels franchises, the ERC program is open to all types of businesses, including educational institutions, churches and other religious organizations, nonprofit organizations, and tribal governments.

Can A Wetzel’s Pretzels Restaurant Be Eligible For The ERC Credit And PPP Loan?

Yes! Even if your Wetzel’s Pretzels restaurant received an SBA Paycheck Protection Program (PPP) loan, an Economic Injury Disaster Loan (EIDL), or a Restaurant Revitalization Fund (RRF) grant, you are still eligible under current IRS rules and regulations, provided certain requirements are met.

The Wetzel’s Pretzels payroll expenses that were paid by PPP loans may not be considered eligible for ERC. You can not claim ERC on the same wages paid by PPP loan. The IRS doesn’t want double-dipping of the same exact wages paid with PPP month to your Wetzel’s Pretzels employees.

Is The ERTC Available To Wetzel’s Pretzels Locations That Received Restaurant Revitalization Fund (RRF) Grants?

Yes! The “Restaurant Revitalization Fund” was recently established as part of the American Rescue Plan Act of 2021, providing restaurants with additional assistance.

A clarification was issued by the IRS on August 20, 2021, stating that Paycheck Protection Program (PPP) loans nor Restaurant Revitalization Funds (“RRF”) should be considered gross receipts for the purposes of determining eligibility.

Are Tipped Wages at Wetzel’s Pretzels Eligible For The Employee Retention Tax Credit? 

Yes! As part of this relief measure, certain qualified wages are eligible for reimbursement via an employer’s payroll tax credits. Tipped wages are included in qualified wages if they meet specific criteria as determined by the US Internal Revenue Service (IRS).

If the tipped wages are more than $20 a month and are subject to FICA then those tipped wages are eligible for ERTC.

What Is The Wetzel’s Pretzels Full-Time or Part-Time Employee Count For ERC Eligibility for 2020 and 2021?

There is confusion because the IRS changed the criteria in 2021 for ERTC.

If you had less than 100 Wetzel’s Pretzels employees paid in any given quarter in 2020 that qualifies, then all gross wages are counted, whether the employee was full-time or part-time.

In 2021, if your Wetzel’s Pretzels restaurant had less than 500 employees paid in any given quarter in 2021 that qualifies, then all gross wages are counted, whether the employee was full-time or part-time working for your Wetzel’s Pretzels franchise.

Would It Be Better If I Combined The Gross Receipts From All Of My Wetzel’s Pretzels Franchise Restaurants?

Restaurants in a group may claim the credit for gross receipts if the value of their gross receipts is equal to or greater than an aggregate sum that’s specified by regulators.

If the group meets the criteria, each individual entity may claim the credit, regardless of whether the group as a whole achieved the minimum threshold.

If the gross receipts present for the group as a whole do not meet the requirements, none of the entities may claim the credit even though some restaurants individually had a decline.

How Do I Compare My Q1 2020 Gross Receipts With My Q1 2019 Gross Receipts If I Didn’t Start My Wetzel’s Pretzels Restaurant Until Mid-Q2 2019?

If you opened your Wetzel’s Pretzels franchise at the beginning of a quarter this year, you can calculate the gross receipts you have for the entire year. The first 3 months of the Wetzel’s Pretzels opening in this year can be used as the basis for this calculation.

Conclusion and Summary for Franchise Owners of Wetzel’s Pretzels Restaurants

The Employee Retention Credit is a great way for Wetzel’s Pretzels restaurants to offset some costs associated with retaining and keeping employees employed during those tough times experienced in 2020 and 2021 due to COVID. 

The ERC Refund will help Wetzel’s Pretzels restaurant owners receive a much-needed tax refund to keep their Wetzel’s Pretzels franchise profitable.

Your Wetzel’s Pretzels location probably qualifies for the ERC based on government orders limiting the indoor seating capacity or hours of operation for your Wetzel’s Pretzels.

Wetzel’s Pretzels Franchise Owners: Get Help on How to Apply for the Employee Retention Tax Credit (ERC / ERTC): Claim Up To a $26,000 Refund Per Employee for Your Wetzel’s Pretzels Location

Disaster Loan Advisors can assist your Wetzel’s Pretzels restaurant with the complex and confusing Employee Retention Credit (ERC) and Employee Retention Tax Credit (ERTC) program. 

Depending on eligibility, Wetzel’s Pretzels owners can receive up to $26,000 per employee based on the number of W2 employees you had on the payroll in 2020 and 2021. 

The ERC / ERTC Program is a valuable IRS tax credit you can claim for your Wetzel’s Pretzels franchise.

Schedule Your Free Employee Retention Credit Consultation to see what amount of employee retention tax credit your Wetzel’s Pretzels location qualifies for.

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