The ERC is a tax credit for employers that is equivalent to 50% of qualified salaries paid to staff members. This credit is available for salaries earned after March 12, 2020, and before January 1, 2021.
The IRS provides a detailed FAQ guide on Employee Retention Credits which is a tax credit against certain employment taxes equal to 50% of the qualified wages. Here is a detailed guide on the FAQ of some of the most common questions around Employee Retention Credit.
Key ERC Credit Takeaways You Will Learn:
- Qualifications: Understand who is eligible for the Employee Retention Credit (ERC).
- Calculating Employer Size: Learn how to determine if an employer is considered large or small for ERC.
- Gross Receipts: Know what is considered gross receipts for Employee Retention Credit eligibility.
- PPP Loan Interaction: Discover the relationship between ERC and Paycheck Protection Program (PPP) loans.
- PEO & ERC: Learn if companies using a Professional Employer Organization (PEO) can claim ERC.
See Important 2024 Employee Retention Tax Credit Deadline Information at the Bottom of This Article.
Employee Retention Tax Credit ERTC FAQ
Employee Retention Credit has various benefits for qualified employees. Employers who endured temporary shutdowns as a result of government restrictions restricting trade, travel, or group meetings; or who saw large drops in monthly gross receipts as a result of the pandemic are eligible for this program.
The ERC is then computed for each individual and filed separately. The credit is available to all eligible businesses of any size that pay qualified wages to employees; however, enterprises with fewer than 100 staff and less than 500 staff must meet additional conditions in 2021 and 2022.
The ERC is a tax credit meant to encourage firms to keep their employees on the job and minimize unemployment compensation claims. In 2021, the credit was calculated differently. Under IRC Section 280C employer tax credits, employers may not deduct wages and health insurance costs related to certain low-income or disadvantaged full-time or part-time employees in an amount equal to specific nonrefundable income tax credits.
As a result, even if the payout has not yet been issued, a 2021 rebate must be recorded on the 2022 tax return. With the exception of New York, which allows the deductions. For qualifying firms that can retain employees on the payroll, the ERC provides a 100% refundable tax credit. The ERC has been shortened as a result of the updated and revised Infrastructure Bill.
Despite the fact that the ERC is not taxable, it is subject to cost disallowance provisions that make it taxable. IRS Notice 2021-49 explained a few more aspects that have been confusing people claiming the ERC. For the purposes of calculating and verifying credit, worker tips are regarded as “qualified wages,” and firms can claim both an ERC and a FICA (Federal Insurance Contributions Act) tip credit for the same amounts.
How Does the Employee Retention Credit Work?
To declare that for each quarter, a new ERC, qualifying salaries in total, and related qualified health plan expenses should be calculated and subtracted from the deposit made using Form 941. When you have already filed your tax return for 2020, you can claim some credit retroactively. To do so, fill out Form 941-X.
Any small business allows employers to deduct 70% of an employee’s eligible compensation up to $10k each quarter from the employee’s earnings through ERC. The maximum quarterly credit for a qualifying employer is $7k. The credit lowers the employee’s Social Security Tax burden. If the qualified wages exceed the Social Security Tax payable, the IRS will issue a refund to the eligible employer.
Qualification is determined by two crucial variables, one of which must be utilized in the calendar quarter in which the amount is to be used. A trade or business was completely or partially suspended or forced to reduce its hours due to a government order. Certain businesses, according to IRS counsel, do not meet this statistical method and hence do not register.
Learn more about How Does Employee Retention Credit Work.
Who Qualifies for the Employee Retention Credit?
Credit for qualified earnings plus allocable deductible health coverage costs is not included in gross income for federal income tax purposes. The refundable element of the credit, as well as the amount that decreases the employer’s relevant employment taxes, are not included in the gross income of the employer.
Employer eligibility is usually established by one of two criteria, at least one of which must be satisfied even during the calendar quarter in which the credit is requested.
- The factory may be shuttered whole or partially due to a government order.
- Due to Gross Receipts that have dropped dramatically.
The ERC might be applicable if the business owners or the firm were forced to entirely or partially suspend operations or limit business hours. The businesses that do not meet this description, according to the IRS, and hence are not eligible. Those regarded as critical until their supply of critical materials/goods is disturbed to the point of no longer being able to operate.
Telework allowed businesses that had been forced to close by their owners to continue operating virtually as normal. When comparing a quarter in 2022 to the same quarter in 2021, the company’s gross receipts must have dropped by half. Beginning in 2022, businesses must have seen a higher than 20% drop in gross revenues in Q1 and Q2 compared to the same time in 2021.
If the business is new, the IRS allows it to utilize total profits from the first quarter as a foundation for any quarter in which it does not have 2021 data.
What are Employee Retention Credit Qualified Wages Paid?
The IRS uses a number of procedures to determine ERC qualifying earnings, qualified health expenditures, and partial suspension, depending on the circumstances. The ERC, salary, and pay are all subject to FICA taxes in the same way that everyone else is. Remember that the refundable tax may only be used for gains that haven’t been wiped or aren’t anticipated to be canceled under the PPP.
A deeper examination of the Internal Revenue Code and regulations finds that the Section 199A exemption may be prohibited for certain pass-through business owners, raising their effective income tax rate from 30% to 37%
The Section 199A deductions might help pass-through business owners lower their government effective tax rate from 37% to 30%. The 199A deduction was included in the Tax Cuts and Jobs Act (TCJA) as a settlement for pass-through business owners in response to widespread public outcry over the proposed corporate tax rate reduction from 35% to 21%.
They usually contain pretax pay for both the employer and the employee but not any qualified after-tax income. Before calculating the allowable salary that must be used prior to the partial suspension, a company must first examine the number of comprehensive personnel. A full-time contractor, such as wastewater disposal services, worked 30 hours per week or 130 hours per month in 2020, as per the ACA’s (Affordable Care Act) worker shared liability provision.
Multiply this with full-time staff by the number of months the enterprise has been in service. The number of regular employees is calculated by dividing the total number of full-time staff in each calendar month by the year’s span for an employer starting a business in 2021, such as one of the rehabilitation startup enterprises. The ERC is appropriate for companies that do commercial operations during the calendar year 2022.
Check out Everything To Know About Employee Retention Credit – ERC Example.
Are Benefits of Employee Retention Credit (ERC) the Same for Large and Small Employers?
The ERC regime provides additional incentives to small businesses. They might include salary paid to all staff throughout the period they are an Authorized Employer. Only salaries given to employees who do not provide services can be included by large firms. You can fill out the ERC information gathering worksheet once you’ve determined that you’re likely qualified for the ERC.
This is where you’ll enter data about your staff and earnings for the periods in question. This typically comprises quarterly financial statements for each year, details on your PPP forgiveness, number of workers, and any already applied credits. The ERC is waiting for firms to claim it, and the prize money is substantial. For each employee in your firm, you might be eligible for up to $7k every quarter in 2021 and more in 2022.
So, for a 10-person firm that was qualified for the entire year of 2021 and the first two quarters of 2022, the potential ERC is $24,000 per employee. Even if you previously thought you weren’t qualified, recent changes to the legislation have made it more accessible to more businesses. You have nothing to lose because we have simplified the computation and method for receiving your ERC money.
How Do You Calculate if an Employer is a Large or Small Employer for the Employee Retention Credits (ERC)?
In the ERC for 2021, a small firm is considered as one with less than 100 regular full-time employees. In the ERCs for 2021, a small firm is classified as one with 500 or fewer full-time employees. According to section 4980H of the Code, a “full-time worker” is someone who works at least 30 hours per week or 130 hours per month in 2019.
The number of full-time workers for an employer that conducted their business for the whole 2019 calendar year is calculated by adding the number of regular staff in each calendar month in 2019 and dividing the total by 12. Others who are not in business for the entire year of 2019 are subject to special regulations. The legislation extends the catastrophe ERC tax credit of 40% of profits (up to $6k per person) to firms in disaster zones for salaries paid whether or not the distressed employers are operational.
Except for COVID-19, these businesses must operate in Governmentally declared disaster zones for terrible events occurring after December 31, 2019, and must continue for 60 days after the bill is passed.
Employee Retention Credit FAQs
IRS has the official list of FAQs related to all the common questions people ask about Employee Retention Credit on their official website. They have listed down all the important questions that you might have on the topic around ERTC.
Businesses that lost income or were forced to close partially due to COVID-19 in 2020 or 2021 may be eligible for the ERC. This is a tax credit established by the 2020 CARES Act to assist businesses like yours, and it may be worth up to $7k per employee every quarter. Medicare taxes will cover the non-refundable portion of the self-employed user’s retention tax credit.
However, this modification will only apply to salaries received after June 30, 2021, and will have no impact on the total credit amount. The number of full-time workers for an employer that conducted their business for the whole 2019 calendar year is calculated by adding the number of regular staff in each calendar month in 2019 and dividing the total by 12. Others who are not in business for the entire year of 2019 are subject to special regulations.
Check out Employee Retention Credit IRS FAQs.
Is the Employee Retention Credit (ERC) Only for Full-Time Employees?
Total wages to part-time and full-time staff may be included in the ERC computation. The sole restriction on how the credits are calculated is that they can only be used for the first $10,000 in pay and health-plan fees paid to each individual during each credit-generating month. In organizations with more workers, only salaries for not providing services and healthcare costs may be included.
This credit can be utilized to pay payroll taxes, or it can be reimbursed by filling out Form 7200. The Advance of Employer Credits Form 7200 can be used to secure an initial tax deposit. Employees are provided it as a result of Covid-19, and it may be beneficial if they qualify as a small business. Two critical factors define qualified earnings, one of which must be used in the calendar quarter in which the quantity is to be used with an ownership share.
The other one is when a company or business is forced to shorten its hours in part or entirely owing to a government decree. It might also be covered back if there was a 50% reduction in gross receipts. When the client’s recovery reached 80% of the previous year’s gross receipts or 2021, whoever came first, the client’s eligibility ended.
What is the Employee Retention Credit Eligibility / Credit-Generating Period(S)?
Firms can recover the ERC for qualifying salaries received in 2022, as well as Q1, Q2, and Q3 of 2021, provided they are eligible. According to the CARES Act, any company that received a Paycheck Protection Program loan was ineligible for the ERC until the PPP loan was paid off before 2020. The Taxpayer Certainty and Disaster Tax Relief (TCDTR) Act of 2020 later lifted this restriction, making PPP Private lenders entitled to the ERC.
Wages that are paid with a PPP loan that is forgiven, on the other hand, are not suitable for credit. Depending on the circumstances, the IRS has a variety of methodologies for determining qualified health costs and partial suspension. They normally include the employer’s and employee’s pretax wages but not any eligible after-tax compensation.
A corporation must first assess the number of comprehensive workers before determining the permissible salaries that must be utilized before the partial suspension.
Learn more about 5 Ways to Determine Eligibility for the Employee Retention Credit.
Can I Still Apply for Employee Retention Credit (ERC)?
For the 2021 ERCs, the statute of limitations does not expire until April 15, 2025. You may still apply for ERC because of this. A company’s gross receipts must have declined by more than 20% from the same quarter the previous year to qualify for 2021. New businesses that did not exist during a specific quarter in 2021 might compare themselves to the same quarter in 2022.
Because of the Infrastructure Investment and Jobs Act, only Recovery Startup Businesses remain eligible for the incentive before December 31, 2021. An application to the ERC is not required. Eligible employers can also claim the ERC when filing their federal payroll tax filings. Most businesses must file Form 941 in order to receive qualified profits.
Employers can modify their Form 941 if they subsequently discover they are entitled to the credit. Form 7200 can be used to request an initial deposit for the ERC until August 2, 2021, according to the IRS. ERCs are completely recoverable payments against the company component of Social Security taxes for the fiscal year 2021, depending on the number of qualifying salaries earned by an eligible business.
An employee’s qualified-wages cap determines the maximum credit. If your business qualifies for the ERC, consider which accounting standard governs revenue recognition. Under Accounting Standards Update (ASU) Subtopic 958-605, the recording of this revenue is deemed admissible. Because an entity can only move funds if it has cleared the eligibility barrier for qualified renovation property, the ERC is considered a conditional gift.
What is the Interplay Between Wages Included in the R&D Credit and Wages Utilized in the Employee Retention Credit Calculations?
Wage costs that qualify as both R&D Credit-eligible and ERC Eligible Wage Qualified Research Expenses must be included as QREs in the base year estimates for future R&D Credit computations. To indicate that a new ERC, total qualifying salary, qualified earnings, and related health insurance expenditures should be computed and deducted from the contribution made using Form 941 for each quarter. You can claim some credits retrospectively if you have already submitted your tax return for 2020.
Employers that have experienced a loss of gross income as a result of the coronavirus epidemic are eligible for the ERC. Firms that skipped out on the ERC in the first two quarters of 2021 can still file a Form 941-X to take advantage of it. The ERC’s irreversible component corresponds to the employer’s Social Security Tax contribution on Form 941-X for the first and second quarters of 2021, which is 6.4% of wages.
In order for an employer’s business activities to qualify as partially suspended, they must have been disrupted by a federal, state, or municipal order, declaration, or decree. A restaurant, for example, that had to close its sitting room owing to a local government decree but could still provide a carry-out or distribution system was regarded to have partially ceased operations. Read full erc credit for restaurants details here.
Because an order reduced the number of hours a company may be open, or because some business activities had to be shuttered and work could not be done remotely, a partial suspension of operational processes could occur.
If you have questions about Form 941-X, check out the recent article: Everything to Know About Form 941 X For Employee Retention Credit.
Are Most Companies Utilizing the Gross Receipts Test or the Government Mandate Test to Reach Eligibility for Employee Retention Credit Purposes?
The Government Mandate Test qualifies most businesses as qualified employers for the 2020 ERC. The Gross Receipts Test qualifies most businesses as qualified employers for the 2021 ERCs. As long as the qualifying employer uses a reasonable actuarial method to estimate the plan’s benefits and projected annual expenditures, the amount of health plan expenses assigned to an employee is determined using standards identical to those for insured plans.
That is, the expected yearly expenditure is calculated by dividing the number of personnel covered by the plan and then by the expected mean of workdays worked by the employees over the year. The amount assigned to each day of qualifying payments is the outcome. Employee after-tax contributions should be taken into account. Payments are given to workers for the additional payoff for holidays, weekends, sick days, and other times off may not be regarded as qualified wages if a company employed more than 100 full-time employees in 2019.
If the firm had 100 or fewer full-time staff on average in 2019, all wages offered to workers during the period of complete or partial suspension of activities or a considerable drop in gross sales are deductible. Even if the earnings are eligible for sick and family leave payments under sections 7001 and 7003 of the FFCRA, they may be recognized costs for objectives of the ERC.
What are Considered Gross Receipts for Employee Retention Credit?
“Gross revenues” are defined under section 448(c) rules as total sales and all monies received for services throughout the taxable year. Gross revenues also include any income from other sources, as well as money from unrelated or outside sources. A taxpayer fulfills the gross revenue test if his or her average yearly gross receipts for the 3 taxable years since its introduction the taxable year do not exceed $25 million, adjusted for inflation.
For Taxable Firms:
- Max sales with all sums received for services.
- The tax accounting procedure for payout recognition applies.
- Added income from the deposits:
- Interest
- Dividends
- Rents
- Annuities and Royalties
- Taxpayer’s reduced and adjusted basis in assets used in a trade or capital sold.
For Non-Taxable Entities:
- Income is recognized using the tax accounting technique.
- Gross Receipts refer to the total amount of money received throughout the tax year.
- The adjusted basis in some property utilized in a trade or company or capital assets sold by the taxpayer is not deducted.
- Investment and grant profits are included.
Because the ERC is reclaimed on a quarterly basis, an employer’s eligibility and the credit amount will change from quarter to quarter. Assume that an employer’s gross receipts were $100k, $190k, and $230k in the first, second, and 3rd calendar quarters of 2020, according to IRS FAQ 39. Gross receipts for the first, second, and third calendar quarters of 2019 were $210k, $230k, and $250k, respectively.
Thus, total earnings for the business in the first, second, and third quarters were about 48 percent, 83 percent, and 92 percent of those in the first, second, and third quarters of 2021. As a result, the business’s gross receipts declined considerably between the beginning day of the first calendar quarter of 2021 and the first day of the third calendar quarter of 2022. As a result, for the first and 2nd calendar quarters, the owner is entitled to a retention credit.
If I Qualify Under Government Mandate Test, Does That Qualify Me As an Eligible Employer for the Entire Quarter?
Yes, technically, but you only pay qualifying salaries while the requirements remain in existence and have a significant influence on the company. Despite the fact that the presidential decree forcing nonessential businesses to close has an impact on essential company activities, according to IRS FAQ 30, an essential enterprise is not considered to have a partial or complete postponement of operations if the legal ruling allows the employer to remain open.
However, if a company’s business suppliers are unable to provide necessary goods or materials owing to a governmental order that compels the supplier to halt operations, the employer may be regarded to have a complete or partial suspension of transactions (IRS FAQ 31).
Employee Retention Credit 2020 FAQs
ERC is a program given by the management for an organization’s members in which they can earn bonus credit. In order to access such benefits, it is normally necessary to fill out a form. The form is known as the 941-X form. If a user does not receive the ERC and rather stays the business’s part of Social Security tax with federal tax installments, the phrase “non-refundable” is erroneous.
If the employer’s Social Security tax payment was made, the non-refundable portion of the ERC is refundable. Whether or not an employee registers and owes federal employment taxes through a third-party payee, he is liable to the ERC. The refundable element of the credit, as well as the amount that decreases the company’s contract of employment duties, will not be included in the gross income of the business.
In 2021, only small businesses will be entitled to request an advance payment of the benefit in an amount not exceeding 70% of the average quarterly salary paid in the calendar year 2019. According to Notice 2021-23, the requirement to reduce deposits in preparation for credit before getting an advance continues in place for 2021 eligible small businesses. Include all eligible health plan costs on your federal employment tax return.
If your federal employment taxes don’t tally up and compensate you for the previous quarter’s payments, you can demand an advance of the amount using Form 7200 to cover exceeding salaries.
Do I Take the Employee Retention Credit Into Income When I Receive It?
No, you don’t take ERC into income when you receive it. Instead, the firm must minimize their pay calculations on their income tax return for the tax year in which they are an ERC-eligible employer. As previously indicated, taxpayers should pay close attention to information on line 18 of Form 941-X for business share, particularly the guidelines on how to convert a positive figure in column 3 to a minus number in column 4.
Does the Employee Retention Credit (ERC) Have to Be Paid Back?
The ERC is a completely refundable tax credit that qualifying firms can use to offset some employment taxes, so you don’t have to pay it back. It is not a loan, and no payback is required. For most taxpayers, the refundable credit is generally greater than the income taxes paid during the credit terms. With so many various cash flow and tax relief alternatives available under COVID-19, firms should contact their financial and tax professionals to discover the best solutions for their circumstances and company requirements.
When choosing between the ERC and the PPP loan, bear in mind that if you have 100 or fewer workers, the ERC may be more advantageous because you may take 50% of all salaries (up to $10,000 per employee) on all employees. If a company employs more than 100 workers, the ERC only applies to wages given to an employee who is unable to deliver services to the employer because of financial difficulty.
How Do I Apply for Employee Retention Tax Credits?
The ERC may only be applied for by filing a revised Form 941-X for the quarters in which the business was a qualified employer. The IRS does not allow electronic filing to be registered for Form 941-X. The IRS can be contacted by printing and mailing the 941-X form. Amendments to the material on the 941 forms are made with the 941-X. View and download the 941-X form to mail to the IRS. The IRS is currently reluctant to accept 941-X forms submitted through the internet.
According to IRS FAQ 73, qualifying businesses must report their entire taxable salaries for ERC purposes on Form 941, Employer’s Quarterly Federal Tax Return, for each calendar quarter. Employers who paid any qualifying wages during 2020, inclusive, shall include 50% of those payments, as well as 50% of any qualified wages paid in the second quarter of 2020, on their second-quarter report.
Learn more about How To Apply For Employee Retention Credit.
How Long Does It Require for the IRS to Provide a Refund After Filing an Amended Form 941-X?
According to our experience, receiving a return from the IRS after filing an updated Form 941-X takes around nine months. Each of the time spans is referred to as a “period of constraints.” For the purposes of the statute of limitations, Forms 941 for a calendar year are presumed filed on April 15 of the subsequent year if completed before that date. A quarterly 941 filer would file four 941-Xs if they made a payroll error for the whole calendar year.
A Form 941-X from a previous quarter should not be mailed with a Form 941. Before you may file Form 941-X, you must wait a certain length of time.
Check out How To Fill Out 941-X For Employee Retention Credit.
Employee Retention Credit 2021 FAQs
An application to the ERC is not required. Employers can also claim the ERC when filing their federal payroll tax filings. Most businesses must file Form 941, Employer’s Quarterly Federal Tax Return, in order to receive the qualified profits. If an employer later learns that they are eligible for the credit, they can amend their Form 941. According to the IRS, Form, 7200 could be utilized to seek an initial deposit for the ERC until August 2, 2021.
The notice also clarifies a scheduling issue with ERC labor expense changes. During the calendar quarter, employers are not authorized to deduct wages used in the ERC calculation from income taxes up to the ERC value. As a consequence, even if a company filed an ERC rebate application for a quarter in 2021, the ERC change to tax liability has been included in the business’s 2021 federal income tax record, even if the rebate accusation was made on earnings in 2022 or later.
Due to COVID-19, the system allows you to claim both the ERC and the tax credit for providing paid time off. However, you cannot claim both bonuses for the same payout. Likewise, paid leave pay cannot be included in the ERC calculation of qualified salaries. To be eligible for ERC, you must report all qualifying salary and accompanying health insurance expenses on your quarterly employment tax returns. This may be done with Form 941.
Firms must determine whether they qualify for ERC status now that the tax filing period for 2022 has begun. If the business meets the criteria, it should request the credit as soon as possible to begin the return procedure.
Can I Get Both the Employee Retention Credit and PPP Loan?
Yes. While salaries covered by a PPP loan are not allowed to be included in the ERC assessment, PPP funds were only available for 8 to 10 weeks of labor expenditures. The ERC has a longer eligibility period. Non-wage expenditures can also be covered through PPP loans. It is critical to create work papers that apportion PPP funds for the whole 24-week Covered Period for ERC reasons.
Do I Need to File for PPP Forgiveness Before I File for the Employee Retention Credit?
No, you don’t need to file for forgiveness normally, but if feasible, allocate the highest non-wage permissible expenditures for the ERC in case of PPP forgiveness.
Does PPP Forgiveness Count As Gross Receipts for Employee Retention Credit?
No, PPP forgiveness does not generate gross revenues in the quantity of the forgiveness, according to safe harbor guidance issued by the IRS in August 2021.
Are Tax Exempt Organizations eligible for ERC from their business operations?
Tax exempt organizations or nonprofit organizations can be eligible to claim ERC if they pass either the Gross Receipts Test showing a significant decline or the Government Orders Test, which means they had to fully or partially suspend their business operations during calendar quarter due to government mandated suspension. To be eligible for refundable tax credits, an organization must pass one of the two tests, not both.
Can Churches and Other Religious Organizations Qualify for Employee Retention Credit?
The ERC is offered to churches and other holy organizations that have seen large reductions in gross income due to government-ordered capacity constraints on meetings.
Employee Retention Credit Q&A
Now, as we have been through the details of ERC and its relevant information, here are some of the most commonly asked questions about ERC.
Do Organizations Owned By Private Equity Funds Need to Aggregate Their Gross Receipts and Employee Counts Together When Determining Eligible Employer Status?
In general, no. The fund controlling portfolio firms is not an active trade or business, brother-sister portfolio companies can likely be classified as independent professions or enterprises when assessing qualified employer status.
Learn more about Gross Receipts for Employee Retention Credit.
Who Qualifies for Employee Retention Credit?
Here is a list of all those who qualify for ERC:
- Non-Profit
- Real Estate and Construction
- Education
- Healthcare and Life Sciences
- Technology
- Professional services
- Government Contractors
- Hospitality and Retail
- Industrial
If I Use a PEO Instead of a Traditional Payroll Tax Provider, Can I Still Claim the Employee Retention Credit?
Yes. Organizations or businesses that use a PEO can still take advantage of the ERC.
Conclusion and Summary on Employee Retention Credits – A Detailed FAQ Guide
The FAQ guide given by the Internal Revenue Service (IRS) on Employee Retention Tax Credit (ERTC) combined with the guide given covers all the important steps that you must need to know if you are eligible for the ERC tax credit process and the best way to claim the ERT Tax Credit.
Check out the official FAQs guide by IRS from here and know all the common questions asked related to ERTC.
ERC PDF Download of This News Article
Download a PDF version of Employee Retention Credits – A Detailed FAQ Guide
Help on How to Get Employee Retention Tax Credit (ERC / ERTC): Receive Up to $26,000 Per Employee for your Business
Disaster Loan Advisors can assist your business with the complex and confusing Employee Retention Credit (ERC) and Employee Retention Tax Credit (ERTC) program.
Depending on eligibility, business owners and companies 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 tax credit you can claim. This is money you have already paid to the IRS in payroll taxes for your W2 employees.
Schedule Your Free Employee Retention Credit Consultation to see how to claim the employee retention tax credit your company qualifies for.
ERC Deadline Urgency in 2024
April 15, 2024 Deadline for the 2020 ERC Tax Year
The deadline is coming up for the final opportunity to retroactively claim your business Employee Retention Credit for the past 2020 tax year. With the April 15, 2024 deadline fast approaching, we urge you; don’t let this final chance pass!
While not all businesses will qualify, as it depends on multiple factors per IRS Rules and Guidelines, you might be leaving significant financial relief on the table from prior COVID impact to your business during the past 2020 and 2021 business operation years.
Last year, in September 2023, the IRS temporarily paused processing ERC Claims for the remainder of last year. We at Disaster Loan Advisors (DLA) predicted this over one year ago when we made this ERC video warning business owners. See the ten-minute mark of the video for details.
TAKE ACTION NOW IN 2024
Even though the IRS has temporarily paused processing, you will still want to check eligibility and file now (if you qualify) because once the IRS will resume processing, ERC tax credit claims are processed in the order they are received.
If you haven’t previously filed for the ERC Credit, it is worth scheduling a phone call to at least explore your possible eligibility from both the past 2020 and 2021 business tax years. Contact us today for a deep-dive analysis to determine if your business qualifies one or more quarters from the 2020 and / or 2021 tax years.
Cover Image Credit: 123RF.com / Fizkes / Disaster Loan Advisors.
As a leading dedicated member of the Tax and Accounting Team at Disaster Loan Advisors™, Mark focuses on unlocking the ERC Tax Credit's potential for eligible firms that qualify, providing strategic advice, and detailed guidance to ensure substantial financial recovery and growth. His methodical approach to client engagement includes comprehensive deep-dive analysis, customized consultation and guidance, and a commitment to achieving tangible results for each business served.
Disaster Loan Advisors™ (DLA) offers a comprehensive suite of services designed to navigate the complexities of the Employee Retention Tax Credit (ERC) program, ensuring that qualified businesses leverage the maximum possible benefit with minimum hassle. Unlike some firms that charge exorbitant contingency or percentage-based fees (often between 10% to 30% of your ERC refund), DLA operates on a fair and reasonable, transparent flat-fee structure that aligns with the IRS's guidelines.
If you are looking for an ERC Company that believes in providing professional ERC Services and value for small business owners, in exchange for a fair, reasonable, and ethical fee for the amount of work required, Disaster Loan Advisors™ is a good fit for you. STAY SAFE. STAY COMPLIANT. KEEP MORE OF YOUR REFUND.™
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