South Dakota Car Dealership Employee Retention Tax Credit for SD Auto Dealers

Cover Image Credit: / Zinkevych / Disaster Loan Advisors.

South Dakota car dealerships, auto dealers, new and used truck dealers, and other automotive related vehicle businesses in SD that were impacted financially by the COVID pandemic will automatically qualify certain periods of time for the employee retention tax credit refund in SD.

South Dakota went into lockdown mode in March 2020 when South Dakota Noem issued mandated executive orders that forced the closure of car businesses throughout South Dakota, including most car, truck, and automobile related businesses. Many car dealership employees in South Dakota were temporarily out of work from closures in SD.

This caused South Dakota auto dealers, auto groups, dealership owners and investors from automotive related companies with multiple rooftop locations in South Dakota to suffer financially during 2020 and 2021 from these executive orders in SD.

When South Dakota slowly started to reopen, business capacity was restricted and limited in South Dakota. Plus, many SD consumers were staying at home, not driving anywhere, and not shopping for new or used cars and trucks in SD.

Overall, South Dakota has an estimated 83 new car franchised brand dealerships in SD that were affected. This SD data is according to the National Automobile Dealers Association (NADA) South Dakota Auto Report.

South Dakota Car Dealership Retail Economic Data Statewide in SD:

– 83 new car dealerships in SD.

– $3 billion in total South Dakota car dealership sales.

– $120 billion in SD state sales tax paid on vehicle sales.

– 8,504 workers employed at dealerships in South Dakota.

– 4,183 direct worker jobs and 4,321 indirect jobs in SD.

– Average of 50 Employees (W-2) per auto dealership.

– Average of $71,058 in annual earnings per worker.

– $297 in total Employee Payroll for South Dakota new car dealerships.

– $57,000,000 in state and federal income and payroll taxes paid in SD.

Other South Dakota new car and used car data statistics in SD:

– South Dakota Auto Dealers Association  (SDADA)

– South Dakota Independent Auto Dealers Association (SDIADA

South Dakota dealerships in cities affected the most included Rapid City, Sioux City, Sioux Falls, and other locations in South Dakota.

See how your South Dakota automotive related business might qualify for the South Dakota Employee Retention Credit IRS Tax Refund for your car, truck, vehicle business in SD. Schedule Your Free South Dakota Car Dealership ERC Consultation today.

South Dakota Employee Retention Tax Credit for Car Dealerships, Auto Dealers and the Automotive Industry in SD

South Dakota car dealerships, automotive dealerships and automotive related businesses in SD are eligible to claim the Employee Retention Credit (ERC). They can receive up to 50% of their qualified wages paid between March 12th, 2020, and December 31st, 2020, in the form of a refundable tax credit from the IRS.

South Dakota car dealerships and related businesses that were established before February 15th, 2020, can receive a refundable tax credit amounting to 70% of qualified salaries and wages paid between January 1st, 2021, and September 30th, 2021. For SD auto dealers or car dealerships started or acquired after that date (referred to as a Recovery Start-up business), they are eligible for employee wage reimbursement up until December 31st, 2021.

The employee retention credit may be retroactively claimed for 2020 and 2021, through 2023, 2024, and 2025 for your car dealership, auto dealerships or automotive related business in South Dakota.

SD Car Dealership Employee Retention Credit, How it Works for Auto Dealers in South Dakota

With the South Dakota requirements and amount of the ERTC tax credits continually changing with the ERC program, SD car dealerships, auto dealers, and automotive dealership owners and principals may find it difficult to understand if they qualify and how much they can claim. 

To maximize the benefits from this South Dakota automotive employee retention tax credit, you must understand which quarters are eligible as well as which employees, wages, and payments meet the criteria for receiving the tax credit for your dealership in SD.

South Dakota Employee Retention Credit Eligibility Requirements for Auto Dealers, Automotive Dealerships and Car Dealerships in SD

The South Dakota automotive dealership industry can take advantage of the employee retention credit in several ways.

For a South Dakota car dealership related business to be eligible for the program, it must have gone through an entire or partial closure because of COVID-19 government regulations or any other kind of government-mandated shut down during certain periods in either 2020 or 2021 as a result of this global pandemic.

Another way is for your South Dakota car dealership entity to demonstrate that it has had either a 2020 quarter with gross receipts at least 50% lower than the same quarter in 2019, or in 2021, quarters with 20% fewer gross receipts compared to the corresponding quarters of 2019. Each three-month period of 2020 and 2021 should be compared to its equivalent month period in 2019.

In South Dakota, Did Your New Car, Used Car, Truck Dealership or Automotive Business Experience any of These?

Full or Partial Shutdown of Your Car Dealership Location in SD

If your car dealership or automotive dealership location in SD was fully or partially shut down for even a few days due to COVID-19, it would qualify your South Dakota auto dealership for the ERC tax credit. There are multiple other ways to qualify and claim your South Dakota ERC credit for your SD car dealership to help financially recover. Even if your South Dakota automotive company received an SBA Paycheck Protection Program (PPP) loan, you may still qualify.

South Dakota Car Dealership Vehicle Sales Decreased in SD

Did your SD dealership sales drop? Not sell as many new or used vehicle units as compared to 2019? In this case, if you can show nominal harm of 10% or more in declining sales or units for your South Dakota automotive business, you qualify. This is a good example for you to claim and receive the ERC tax credit in South Dakota.

Limitations on Car Showroom or Auto Repair Service Capacity South Dakota

Due to the shutdown and partial-shutdown in South Dakota, your automotive operations greatly reduced capacity due to government mandates and orders. This means that even if your SD car dealership or automotive repair business did not meet adequate revenue losses, you can still be eligible for the ERTC tax credit from mandated South Dakota restrictions from executive orders.

South Dakota Impacted Business and Consumer Travel in SD

The inability of South Dakota residents, tourists, and business travelers to drive around in South Dakota lead to substantial losses. With many public events and gatherings in SD canceled or postponed, caused most South Dakota residents to stay at home. This created massive lost sales and revenue potential for many car dealerships in South Dakota. Therefore, you may qualify for the ERC tax credit if your automotive business has been affected by these limitations in SD.

SD New or Used Car and Truck Vehicle Cancellations and Refunds Due to COVID in South Dakota

Maybe your SD automotive business had vehicle buyers wanting to cancel their new or used car or truck order or car lease, and did not want to take delivery or renew their lease. When South Dakota shutdown, and then faced many business capacity and travel restrictions, consumers canceled travel plans and were not driving as much, according to the South Dakota Department of Transportation. This caused many SD automotive dealership operations to refund deposits and lose further revenue. This was a financial loss to the economy and auto dealers in South Dakota

No In-Person Selling or Face-to-Face Auto, Truck, Car Sales in SD

Due to the pandemic, SD auto dealers could not sell any cars or trucks during the shutdown periods. This was an obstacle for South Dakota auto dealers trying to accommodate new and used car buyers. The vehicle buying experience was taken away. If your SD automotive business dealt with this situation, or had severely limited business and operations capacity due to South Dakota mandated orders, your dealership will qualify for the ERC tax credit.

South Dakota Car Dealership Low Inventory Due to Shipping and Supply Chain Issues in SD

In South Dakota, automobile manufacturers continued to limit new vehicle production and inventories throughout 2021 and 2022 due to the semiconductor microchip shortage that began in early 2021. South Dakota franchised car dealerships were experiencing restricted new car and truck inventory at auto dealerships in SD and across the country. New vehicle inventory on the ground and in transit was consistently stuck at over one million vehicle units nationwide and in SD.

Calculating Your South Dakota Auto Dealer Employee Retention Credit for Car Dealerships in SD

Accurately calculating the South Dakota employee retention credit for your automotive dealership employees requires attention to detail, especially when it comes to determining your total payroll gross wages paid during each quarter to your workforce. Without accurately calculating this figure, you won’t be able to maximize the full tax benefits of this ERC credit. Therefore, having a comprehensive understanding of how best to calculate these figures is essential to maximize your car dealership related business tax credit in SD.

How South Dakota Car Dealerships, Auto Dealers, and Automotive Employers in SD Can Claim the Employee Retention Credit

Although the process of applying for the ERTC for your South Dakota company has changed a bit, there’s still time to claim your ERC tax refund. Remember that this window won’t be open forever. It will cease in 2023, 2024, and 2025 based on the past 2020-2021 quarter evaluations. Don’t worry about running out of funds either. These IRS business tax refunds are calculated using each business’ qualifications and financials. The only way you can miss out is by not filing prior to the given deadlines for your car dealership in South Dakota.

Conclusion and Summary for South Dakota Car Dealership, Auto Dealer, and Automotive Employee Retention Credit in SD

To ensure your South Dakota car dealership or automotive related business is in compliance with the Employee Retention Credit, it’s critical to have all original records, including payroll, W-2s, original 941’s filed, and other documents related to auto dealership employee wages. Additionally, any South Dakota government shutdown orders or restrictions on your South Dakota car dealership should be documented.

By understanding the rules of the employee retention credit, car dealerships, auto dealers, automotive businesses and companies in South Dakota can make sure they’re getting all the IRS tax credit benefits owed to them. The ERTC provides an opportunity for car dealerships affected by COVID-19 in South Dakota to recover some financial losses.

South Dakota Car Dealerships and Automotive Businesses Qualify for the Employee Retention Tax Credit (ERC / ERTC) in SD: Claim Up To a $26,000 Refund Per Dealership Employee for Your Automotive Business in SD

Disaster Loan Advisors™ can assist your South Dakota car dealership and automotive business with the complex and confusing Employee Retention Credit (ERC) and Employee Retention Tax Credit (ERTC) program, without you having to sacrifice an excessive percentage % of your hard-earned ERC refund. 

DLA doesn’t charge a percent % like many companies do. Our flat fee structure is fair and reasonable based on the amount of work involved. Keep More of Your Refund™ 

Depending on eligibility, car and truck dealership owners, automotive professionals, and auto dealer principals and partners can receive up to $26,000 per automotive workforce 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 automotive dealership in South Dakota.

Schedule Your Free South Dakota Automotive Employee Retention Credit Consultation to see what amount of employee retention credit tax refund you qualify for your car dealership in South Dakota.

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