The Employee Retention Credit (ERC) is part of the Coronavirus Aid Relief Economic Security Act that was voted into law back in March 2020. Section 2301 of this CARES Act describes the ERC as a refundable payroll tax credit designed to support employers whose businesses were disrupted by the COVID-19 pandemic restrictions.
Since its first introduction, ERC had gone under a lot of revisions as part of the Consolidated Appropriations Act of 2021 and American Rescue Plan of 2021.
One of the major changes to note was when it first went into law, employers who obtained the Paycheck Protection Program (PPP) could not get ERC. At The end of 2020 the law was amended to allow those who got PPP to also get the ERC. The only stipulation is that the same wages cannot be used for both ERC and PPP forgiveness.
Another major change is the period in which this act covers. As of the latest legislation, ERC covers the wages paid from March 12, 2020, through December 31, 2021.
Although this act had sunset on almost a year ago, eligible employers can still file claims retroactively until 2024.
Who Qualifies for Employee Retention Credit or ERC?
To qualify for Employee Retention Credit or ERC, employers must have operated a trade or business during calendar years 2020 or 2021 and:
- you must have a reduction in gross receipts defined 50% per quarter in 2020 compared to 2019 or only 20% per quarter comparing 2021 to 2019
- OR if due to a law by a governing authority your business was partially suspended.
Interested in Claiming Employee Retention Credit? We’re Here to Assist You!
Again, although this act had ended on almost a year ago, eligible employers can still file claims retroactively until 2024.
Many employers failed to realize that they qualify for ERC and can miss out this huge credit.
We, at HZ CPAs & Advisors, know that understanding and filing Employee Retention Credit may be daunting considering all the changes this law has gone under, but we made it our mission to assist employers to get this credit smoothly.
Since there are many rules regarding obtaining this credit, it is imperative that you work with an expert who will document all this information. Our Enrolled Agent and ERC-expert, Michelle Koppel EA, will help you with all the paperwork, calculations and laws regarding ERC and we will make sure to help you get this credit and save all supporting data in case of audit.
Our Employee Retention Credit Services has helped many business owners get over 10 million dollars by claiming this credit.
If you would like a more detailed explanation, please listen to my latest webinar: https://www.youtube.com/watch?v=0Ido7PGMGy4
If you need assistance getting ERC before it fully disappears, contact Michelle via her email: michelle@hzcpas.com or directly book a meeting with her by using this link.
