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Unveiling the Employee Retention Tax Credit Opportunity

Unveiling the Employee Retention Tax Credit Opportunity: Are You Missing Out?

The Employee Retention Credit (ERC) is a potentially lucrative opportunity many businesses may overlook. This tax credit could mean thousands of dollars per employee for your business. Yet, while most businesses applied for PPP and EIDL loans in 2020 and 2021, few have taken advantage of the ERC.

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What is the Employee Retention Credit (ERC)?

The Employee Retention Credit is a refundable tax credit against certain employment taxes. It was designed to encourage businesses to keep employees on their payroll during the economic uncertainty caused by the COVID-19 pandemic.

Who is Eligible for the ERC?

The eligibility criteria for the ERC are broad. You could be eligible if your business operations were fully or partially suspended due to a COVID-19-related shutdown order or if you experienced a significant decline in gross receipts during a calendar quarter.

How Much Can You Receive?

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The amount you can receive through the ERC is substantial. For 2020, the credit is 50% of up to $10,000 in qualified wages, including health plan expenses, paid to an employee for the year. That means you could receive up to $5,000 per employee.

For 2021, the credit was expanded. It's now 70% of up to $10,000 in qualified wages, including health plan expenses, paid to an employee per quarter. This means you could receive as much as $7,000 per employee per quarter.

How to Claim the ERC

To claim the ERC, you must report your total qualified wages and related health insurance costs for each quarter on your employment tax return. If your employment tax deposits aren't sufficient to cover the credit, you may receive an advance payment from the IRS.

Don't Miss Out on the ERC Opportunity

The Employee Retention Credit is a significant opportunity for businesses impacted by the COVID-19 pandemic. If you haven't explored this option, it's worth investigating whether your business qualifies.

FAQs

  1. What is the Employee Retention Credit (ERC)?
    The ERC is a refundable tax credit against certain employment taxes designed to encourage businesses to keep employees on their payroll during the COVID-19 pandemic.
  2. Who is eligible for the ERC?
    Businesses whose operations were fully or partially suspended due to a COVID-19-related shutdown order, or those that experienced a significant decline in gross receipts during a calendar quarter, may be eligible.
  3. How much can a business receive through the ERC?
    For 2020, the credit is 50% of up to $10,000 in qualified wages per employee for the year. For 2021, the credit is 70% of up to $10,000 in qualified wages per employee per quarter.
  4. How can a business claim the ERC?
    Businesses must report their total qualified wages and related health insurance costs for each quarter on their employment tax return.
  5. What if a business's employment tax deposits aren't sufficient to cover the credit?
    If a business's employment tax deposits aren't enough to cover the credit, they may receive an advance payment from the IRS.
  6. Is the ERC still available?
    Yes, The deadline for claiming the ERC for eligible quarters in 2020 is April 15, 2024. The deadline for claiming the ERC for eligible quarters in 2021 is April 15, 2025.
  7. How long will it take to receive my refund?
    While the timeline may vary based on the IRS workload, we see clients receive refunds within 4-10 months from filing. The timeline may vary as the IRS’s process varies. 

Conclusion

The Employee Retention Credit is a significant opportunity that many businesses may be overlooking. If the COVID-19 pandemic has impacted your business, it's worth investigating whether you qualify for this potentially lucrative tax credit. Don't miss this opportunity to receive thousands of dollars per employee.

Don’t wait; this program will end soon! Click HERE to see if your business qualifies for this great program!

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