Employee Retention Credit
The Employee Retention Credit (ERC), which was created to encourage employers to keep their workforces intact during the COVID-19 pandemic, has been with us for over two years. Unfortunately questions about it continue to remain for many employers. With the new American Rescue Plan Act (ARPA) extending the credit and expanding eligibility — and the credit worth as much as $21,000 per employee for 2021 — employers should take another look to see if they are eligible for the program.
Step 1 – Determine if your Business Qualifies
Review the questions below.
1.) Did the business report a 50% or greater decline in revenue in any calendar quarter in 2020, compared to that same quarter in 2019?
2.) Did the business report a 20% or greater decline in revenue during the first 3 quarters of 2021, or the fourth quarter of 2020, compared to that same quarter in 2019?
3.) Did the business endure the inability to obtain critical goods or materials from its suppliers that were required to suspend operations due to a COVID-19 related Government order?
4.) Was the business forced to reduce operating hours due to a COVID-19 related Government order?
5.) Did the business have a Covid-19 related, Government-mandated, suspension of any portion of operations during any quarter(s) in 2020, or in the first 3 quarters of 2021? If so, did this segment of operations account for at least 10% of total revenue, in the same quarter(s) of 2019?
6.) Did the business have a Covid-19 related, Government-mandated, suspension of any portion of operations during any quarter(s) in 2020, or in the first 3 quarters of 2021? If so, did this segment of operations account for at least 10% of total employee service hours, in the same quarter(s) of 2019?
7.) Did your company begin conducting a trade or business after 2/15/2020, and your total average annual gross receipts for the three previous tax years were less than or equal to $1 million?
Step 2 – Contact the Experts
If you answered yes to any of the questions above, your business may qualify to receive a refundable tax credit based on the wages paid to employees. Complete the form below to talk to one of our ERC specialists with help determining the amount of credit your business may be eligible for.
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