ERC is a stimulus program designed to help those businesses that were able to retain their employees during the Covid-19 pandemic. Established by the CARES Act, it is a refundable tax credit - a grant, not a loan - that you can claim for your business. The ERC is available to both small and mid-sized businesses. It is based on qualified wages and healthcare paid to employees.

There are two ways to qualify: FULL OR PARTIAL SUSPENSION OF BUSINESS OPERATIONS A government authority required partial or full shutdown of your business during 2020 or 2021. This includes your operations being limited by commerce, inability to travel, or restrictions of group meetings. GROSS RECEIPTS REDUCTION Gross receipt reduction criteria are different for 2020 and 2021 but are measured against the current quarter as compared to 2019 pre-COVID amounts.

Here are some impacts to consider that qualify your business for the Employee Here are some impacts to consider that qualify your business for the Employee Retention Credit: 1. Change in business hours 2. Partial or full suspension of your operations 3. Shutdowns of your supply chain or vendors 4. Reduction in services offered 5. Reduction in workforce or employee workloads 6. A disruption in your business (division or department closures) 7. Inability to visit a client’s job site 8. Suppliers were unable to make deliveries of critical goods or materials 9. Additional spacing requirements for employees and customers due to social distancing 10. Change in job roles/functions 11. Tasks or work that couldn’t be done from home or while transitioning to remote work conditions 12. Lack of Travel 13. Lack of Group Meetings

There are two ways to qualify; EITHER a change in your operations OR a revenue decline. You do not need a revenue decline to qualify, in fact many businesses had a revenue increase and still qualified.

Yes. Under the Consolidated Appropriations Act, businesses can now qualify for the ERC even if they already received a PPP loan. Note, though, that the ERC will only apply to wages not used for the PPP.

The ERC program was created in early 2020 and subsequently updated, changed, and expanded a few times over the next two years through new acts passed by Congress. As a result, many businesses have disqualified themselves due to misinformation, lack of guidance, or lack of understanding. Others have missed out simply because they did not have the time to figure out how to qualify and file the paperwork. Sending in the wrong paperwork, or filling it in incorrectly, has created lengthy delays in receiving the credit, if at all.

The refund is a deduction in the payroll expense for the period that the credit is for. The interest that the IRS pays on the credit is considered taxable income in the period that the payment is received.

An eligible employer claiming a refundable credit for any quarter in 2020 must file its 941x forms by April 15, 2024. An eligible employer claiming a refundable credit for any quarter in 2021 must file its 941x forms by April 15, 2025. We have clients who have received refunds from $100,000 to $6 million.