What is the Employee Retention Credit and how does it work?

Simply put, the Employee Retention credit (ERC), is exactly what it sounds. It rewards business owners for keeping employees on payroll during the pandemic. We are working closely with decision-makers in Washington on this nationwide effort to help the U.S. economy not only recover from the pandemic but come back stronger than before.

Five Things You Need to Know About the ERC

We’re going to help you cut through all the noise. You should know that:

ERC is not for every business.

You likely can’t claim $26k for every employee

Not every COVID impact qualifies a business

Not every government guideline qualifies a business

Claiming PPP affects how much ERC can be claimed

How to Qualify

Even if you have already reviewed the ERC, we recommend that you take a second look with one our specialists. Unfortunately, the program is not yet living up to its full potential because many business owners are prematurely disqualifying themselves due to misinformation and rumors about who does or doesn’t qualify.

Businesses should focus on the overall theme of how the coronavirus virus pandemic affected our economy. This means that even if your company grew during the pandemic, you need to consider other factors before disqualifying yourself.

The payroll tax credit is available to all essential and non-essential companies in any industry that has suffered the effects of the pandemic. Many business owners have had to adjust to the fact that there were many government orders at all levels, including those from the federal, state and local governments. One example of a affected business is a restaurant that couldn’t allow customers to eat indoors, or a manufacturer who had to slow down their operations because of new safety and health regulations.

Here are some impacts to consider that help you determine your business’s eligibility for the ERC:

Full shutdowns;

Partial shut downs

Interrupted operations;

Supply chain disruptions

Inability to access equipment;

Limited capacity to operate;

Inability to work with your vendors;

Reduction in services or goods offered to your customers;

Cut down on your hours of operation; and

Shifting hours can improve sanitation in your facility

For additional information about are erc credits taxable go to our new site