The Employee Retention Tax Credit is a refundable tax credit (a grant, not a loan) that was introduced by the Coronavirus Aid, Relief, and Economic Security (CARES) Act in response to the COVID-19 pandemic. It’s a stimulus program designed to help businesses that retained employees during the Covid-19 pandemic.
ERTC (Employee Retention Tax Credit)
What documents are needed to determine if a company qualifies, and the amount of the claim?
Payroll & Gross Receipts Information
- Earnings by employee by check date for the time frame (check dates); 1/1/2020 to 9/30/2021 inclusive of both endpoints. Format: excel preferred.
- Form 941 for each quarter in 2020 and the first three quarters of 2021.
- Gross Receipts (revenue) by calendar quarter for the time period 1/1/2019 to 12/31/2021. Accounting method is the same as your Federal Income Tax accounting method.
PPP Information
- PPP loan data, for each PPP loan: Funding Date & Amount
- Forgiven (Y/N or not applied for yet)
- If forgiveness applied for/granted, Form 3508 data. This will be used to determine the amount of payroll actually contributing to the forgiveness amount.
General Business Information
- List of owners and ownership percentage. If owners have ownership interest in other business entities; we will need information on those positions to determine if the controlled group rules apply
- Business Address on file with the IRS.
Frequently Asked Questions
What are the criteria for a business to qualify?
To qualify for the ERTC, an employer must meet one of two criteria:
- The employer’s business was fully or partially suspended by government orders due to COVID-19 during the calendar quarter, OR
- The employer’s gross receipts for a calendar quarter in 2020 or 2021 are less than 80% of the gross receipts for the same calendar quarter in 2019.
Additionally, the business must have been in operation in 2019 or 2020.
If an employer received a PPP loan, they may still be eligible for the ERTC for wages that were not paid for with forgiven PPP funds.
It’s important to note that the qualifications and requirements for the ERTC can be complex, and employers should consult with a qualified tax professional to determine their eligibility and to properly calculate and claim the credit.
What is the ERTC?
The Employee Retention Tax Credit is a refundable tax credit (a grant, not a loan) that was introduced by the Coronavirus Aid, Relief, and Economic Security (CARES) Act in response to the COVID-19 pandemic. It’s a stimulus program designed to help businesses that retained employees during the Covid-19 pandemic.
Additionally, the employer must also meet the following requirements:
You can claim up to $5,000 per employee for 2020. For 2021, you can claim up to $7,000 per employee per quarter for the first three quarters. The maximum is $26,000 per employee.
What is the fee for our analysis and filing? When is the fee due?
Our fee is 10% of the Credit amount.
The fee is due when the client receives the funds from the Federal Government.
We don’t charge a fee on the interest you’ll receive on your claim.
What if I don’t qualify or choose not to file the claim?
Our fee is only due if you file and when you receive the funds.
