Covid 19 has been a huge challenge for many businesses over the last couple of years. As the world shutdown many small businesses had the overwhelming task of staying afloat as everything came to a griding halt. Several government programs have been put in place to assist with the recovery process. Employee Retention Credits is one of those programs that have offered a tremendous boost in Cash for businesses. What is Employee Retention Credits (ERC)? The federal government established the Employee Retention Credit (ERC) to provide a refundable employment tax credit to help businesses with the cost of keeping staff employed.

Key Features of the ERC Program

  • UP TO $26,000 PER EMPLOYEE
  • AVAILABLE FOR 2020 & Q1 – Q3 2021
  • QUALIFY WITH DECREASED REVENUE OR COVID EVENT
  • NO LIMIT ON FUNDING (ERC IS NOT A LOAN)
  • ERC IS A REFUNDABLE TAX CREDIT

Did you know the rules changed for the ERC? I received PPP forgiveness, and did not show loss in revenue (except q3 2021) and still qualified for a $200,000+ check from the IRS, larger agencies (100+ FTE’s are eligible for 1-3q 21′).

Who is eligible for ERC?

There are 2 criteria:

  1. If a business had a reduction in gross receipts less than 50% in 2020 as compared to the same Qtr in 2019 or less than 80% in 2021 as compare to the same Qtr in 2019
  2. A partial or complete shutdown mandated by the Federal Government.