Employee Tax Credits

COVID Employee Retention Tax Credits

What are Employee Retention Tax Credits?

During the COVID pandemic, most small & mid-sized businesses suffered heavy financial losses and the US Government is urging employers to take advantage of payroll tax credits of up to $26K per employee. 

Under the CARES Act of 2020, the Employee Retention Tax Credit program (ERTC) is a refundable payroll tax credit designed to reward business owners for retaining employees throughout the COVID-19 Pandemic. If your business suffered a partial or full suspension of operations “or” a significant reduction in revenue and you maintained some or all of your W-2 Employees, you may be eligible for substantial payroll tax credits you deserve and need. 

Business owners impacted by COVID-19 can claim up to $5,000 in refundable tax credits for each employee on their payroll in 2020 and up to a $7,000 credit per quarter (excluding Q4) for each employee in 2021. 

As an example, if your business employed as little as ten (10) W-2 employees during the COVID pandemic, you may be eligible for up to $260K.

While this program was designed to incentivize your business during a very difficult time, the payroll tax credits will not last forever.  

Beginning Q2 2023, the IRS will begin phasing out these credits.

Can you qualify if you received PPP Funding?

Yes!  The Taxpayer Certainty and Disaster Tax Relief Act of 2020, enacted December 27, 2020, made a number of changes to the employee retention tax credits previously made available under the CARES Act, including modifying and extending the Employee Retention Credit (ERC), for six months through June 30, 2021. Several of the changes apply only to 2021, while others apply to both 2020 and 2021.

Retroactive to the March 27, 2020, enactment of the CARES Act, the law now allows employers who received Paycheck Protection Program (PPP) loans to claim the ERTC for qualified wages that are not treated as payroll costs in obtaining forgiveness of the PPP loan.

If you believe you qualify, please complete the Employee Tax Credit Questionnaire.

Disclaimer: The information provided above is for general informational purposes only, and may not reflect the most current legal developments. The information does not constitute legal, tax, or employment advice, and no warranties are made on such information.

ERTC Questionnaire

Does your business qualify? Please complete the below questions!