What is the Employee Retention Credit?
- The Employee Retention Credit (ERC) is a stimulus program designed to help those businesses that continued to pay employees during the COVID-19 pandemic.
- It is a grant that you can claim for your business. (You don’t have to pay it back)
- It is based on qualified wages paid to employees. (Up to 26k per employee)
Do we still qualify if we already took the PPP?
- Yes! Under the new changes implemented in 2021 (Consolidated Appropriations Act), businesses can now qualify for the ERC even if they already received a PPP loan. The deadline is up to three years after filling the original 941 forms.
- Please note though, that the ERC will only apply to wages not used for the PPP.
Do we still qualify if we remained open during the pandemic?
- Yes! As long as your business operations experienced changes due to government orders.
- The gross receipts test is the primary analysis that will qualify a business for the credit. Alternatively, a governmental shutdown where a business experiences supply chains issues, capacity restraints, and several other factors can too qualify the company for a credit.
Will I get audited filing for the ERC?
- Very unlikely, the audit rate for employment-related tax returns is 3 per 10,000 returns. It is important to site accurate law on the amended return though to refrain from an audit.
- If for some reason your return is audited, the team at Esshaki & Associates will defend your filing.
Why isn’t the ERC common knowledge?
- Whether by design or not, the IRS has not marketed the ERC effectively.
- A significant percentage of our clients came to us because their CPA did not know of the ERC, especially the new rule changes in 2021.
Will it cost me anything?
- No! The only fee applicable is to the CPA who is preparing the amended returns.
- There is absolutely no out of pocket costs for you or your business to file the amended returns.
Contact Us
Give us a Call at (248) 968-4700 or leave a message with any questions you may have below.