What is the Employee Retention Credit?
Putting it simply, the Employee Retention Credit (ERC) is exactly what it sounds like–business owners are being rewarded for their efforts to keep employees on payroll during the pandemic. Washington decision-makers are closely involved in this national effort to help the U.S. recover from the pandemic and come back stronger than ever before.
5 Things to Know about the ERC
We’re going to help you cut through all the noise. You should know that:
Not every business qualifies for ERC
Most likely, you won’t be able to claim $26k per 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.
The overarching theme for businesses to focus on is how the coronavirus pandemic impacted our economy as a whole… so even if your business grew or was deemed an essential business during the pandemic, there are more qualifying factors to look at before you disqualify 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. Examples of affected businesses include a restaurant that could not let customers dine indoors or a manufacturer that had to slow their operations due to new health and safety restrictions.
These are some factors to consider when determining whether your business is eligible for the ERC.
Full shutdowns;
Partial shut downs
Interrupted operations;
Supply chain disruptions
Inability to access equipment
Limited capacity to operate;
Inability to communicate with vendors
Reduced services or goods provided to customers
Reduce your operating hours.
Shifting hours to increase sanitation of your facility
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