Maximizing Your Claims For Keeping Americans Employed
The ERTC was established by the Coronavirus Aid, Relief, and Economic Security (CARES) Act, and provides a credit equal to 50 percent of qualified wages and health plan expenses paid after March 12, 2020 and before Jan. 1, 2021.
A per-employee $10,000 maximum of qualified 2021 wages (Q1, Q2, Q3).
That is a potential of up to $21,000 per employee!
While the ERC was created in the CARES act along with the PPP Loans - this is not a loan, there is no repayment.
There are no restrictions for what recipients of the credit must use the funds.
The ERC was established by the Coronavirus Aid, Relief, and Economic Security (CARES) Act, and provides a credit equal to 50 percent of qualified wages and health plan expenses paid after March 12, 2020 and before Jan. 1, 2021.
A per-employee $10,000 maximum of qualified 2021 wages (Q1, Q2, Q3).
That is a potential of up to $21,000 per employee!
While the ERC was created in the CARES act along with the PPP Loans - this is not a loan, there is no repayment.
There are no restrictions for what recipients of the credit must use the funds.
The 2020 ERC Program is a refundable credit of 50% of up to $10,000 in wages paid per employee from 3/12/20-12/31/20 by an eligible employer. That is a potential of up to $5,000 per employee.
In 2021 the ERC increased to 70% of up to $10,000 in wages paid per employee per quarter for Q1, Q2, and Q3. That is a potential of up to $21,000 per employee.
Startups are eligible for up to $33,000.
By answering a few, simple, non-invasive questions our team of ERC experts can determine if you likely qualify for a no-strings-attached credit.
There is no cost or obligation to be pre-qualified.
The 2020 ERC Program is a refundable tax credit of 50% of up to $10,000 in wages paid per employee from 3/12/20-12/31/20 by an eligible employer. That is a potential of up to $5,000 per employee.
In 2021 the ERC increased to 70% of up to $10,000 in wages paid per employee per quarter for Q1, Q2, and Q3. That is a potential of up to $21,000 per employee.
Startups eligible for up to $33,000.
By answering a few, simple, non-invasive questions our team of ERC experts can determine if you likely qualify for a no-strings-attached tax credit.
There is no cost or obligation to be pre-qualified.
We only specialize in maximizing Employee Retention Credits for small business owners. You won’t find us preparing income taxes, compiling financial statements, or providing attestation services of any kind.
We only specialize in maximizing Employee Retention Credits for small business owners. You won’t find us preparing income taxes, compiling financial statements, or providing attestation services of any kind.
Business Consulting Firm in Newport Beach, California, 19 W-2 Employees;
Presentation Design Agency in Nashville, TN, 19 W-2 Employees;
Restaurant Ownership Group in Florida, 224 W-2 Employees;
Restaurant in Houston, Texas, 80 W-2 Employees;
Montessori School in Addison, Illinois, 35 W-2 Employees;
Hair Salon
with 36 employees;
General Contractor with
59 employees;
Home Healthcare Staffing Firm with 195 employees;
ESL School Non - Profit with 25 employees;
Singe Location Pizza Shop with 26 employees;
Business Consulting Firm in Newport Beach, California, 19 W-2 Employees;
Presentation Design Agency in Nashville, TN, 19 W-2 Employees;
Restaurant Ownership Group in Florida, 224 W-2 Employees;
Restaurant in Houston, Texas, 80 W-2 Employees;
Montessori School in Addison, Illinois, 35 W-2 Employees;
Hair Salon
with 36 employees:
General Contractor with
59 employees;
Home Healthcare Staffing Firm with 195 employees;
ESL School Non - Profit with 25 employees;
Singe location Pizza Shop with 26 employees;
Most of our customers get tax relief after their first session, and follow up for additional tax credits.
When the Employee Retention Credit was included in the CARES Act, we knew we wanted help navigating the guidelines, calculations, and paperwork so we could maximize our tax credit and get everything filed correctly. We were very pleased with the services.
Jack R.
Dental Practice Owner
Great job walking us through the steps needed to move forward, and make sure approved before any additional steps are taken. They’re knowledgeable and take care of everything for you. I highly recommend you reach out to them and see how much they can obtain for you.
Laura W.
Commercial Cleaning Owner
They know the laws and rules of the refunding that we received I didn't know anything about these before talking to a friend that referred me. To date, we have received about $80,000 with more coming. I would advise anyone to just reach out to see if it works for you also.
Toni I.
Dental Practice Owner
Take advantage of this new COVID-19 employee retention credit while it’s available. If your business has been affected by the pandemic you will qualify.
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By submitting this form and signing up for texts, you consent to receive marketing text messages (e.g. account notifications, delivery updates, and customer care) from Employee Retention Credit at the number provided, including messages sent by autodialer. Consent is not a condition of purchase. Msg & data rates may apply. Msg frequency varies. Unsubscribe at any time by replying STOP or clicking the unsubscribe link (where available).
Take advantage of this new COVID-19 employee retention credit while it’s available. If your business has been affected by the pandemic you will qualify.
Take advantage of this new COVID-19 employee retention credit while it’s available. If your business has been affected by the pandemic you will qualify.
Calculate your ERC Refund?
I agree to terms and condition provided by the company.
By submitting this form and signing up for texts, you consent to receive marketing text messages (e.g. account notifications, delivery updates, and customer care) from Employee Retention Credit at the number provided, including messages sent by autodialer. Consent is not a condition of purchase. Msg & data rates may apply. Msg frequency varies. Unsubscribe at any time by replying STOP or clicking the unsubscribe link (where available).
FAQs
The Coronavirus Aid, Relief, and Economic Security Act (also known as the CARES Act) was signed into law on March 27, 2020. It included two programs to assist businesses with keeping workers employed: the Payroll Protection Program (PPP) administered by the Small Business Adminstration and Employee Retention Credit (ERC) administered by the Internal Revenue Service.
PPP funds are distributed based on 2.5 months of payroll and a minimum of 80% of the funds must be used on payroll to be eligible for forgiveness. Additionally, PPP funds are not taxable as revenue and you may still take deductions for the payroll covered by PPP.
ERC tax credits, however, are credits (or refunds) for a percentage of payroll in each quarter that you qualify. There are specific rules for determining eligibility by quarter, and limiting the dollars that can be claimed for each employee.
Initially with the CARES Act, employers could choose to apply for PPP or claim ERC credits, but not both.
PPP was more beneficial than ERC for most businesses (for reasons we won’t go into here) and so most businesses with under 500 employees received forgivable PPP Loans.
On March 11, 2021, The American Rescue Plan Act of 2021 was signed into law and included many modifications and expansions to existing elements of previous stimulus programs.
Noteworthy modifications for business owners included:
Businesses who applied for and received PPP funds could now also claim ERC credits.
ERC credits could be retroactively claimed for businesses that qualified in 2020.
ERC credits were extended through 9/30/21 with lower qualification requirements.
The per-employee cap on qualifying wages increased from $10,000 for all of 2020 to $10,000 per quarter for the first 3 quarters of 2021.
The refundable credit amount increased from 50% of qualifying wages in 2020 to 70% in 2021.
So the short answer is “Yes” . . . you can claim ERC even if you received PPP funds.
Unlike the Payroll Protection Program (administered by the Small Business Administration), there is actually no “application process” for the Employee Retention Credits.
You simply claim the ERC tax credit like you would any other tax credit – by asserting to the IRS that you can legally claim the credit.
When you claim a child tax credit, you do so by asserting this fact on your Form 1020 Personal Income Tax Return.
The difference is that when you claim an ERC tax credit, you do so on your Form 941 Employer Quarterly Tax Filing.
For prior quarters, you must file an amended form (the Form 941-X) to reduce your current quarter’s tax contribution and request a refund of excess credits (which is highly likely).
Another perk of ERC, is that since you can often estimate these credits in advance of distributing cash for payroll, you can file a Form 7200 to receive a cash advance to avoid waiting until the end of the quarter to apply for the refund.
Even though you may feel like revenue is back to normal, there are some items you want to consider before passing on this ERTC assessment.
First, even if revenues have returned to “normal” in 2021, you may have qualified in 2020 and you can retroactively claim those credits. That eligibility criteria in 2020 was based on revenue declines from 2019, or if your business was partially or fully closed due to governmental mandate.
Second, while your revenue may have returned to “normal” in Q1 2021, remember that we are comparing your Q1 2021 to Q1 2019. If 2019 was a year of growth for your business, then your revenue levels 2 years ago may have been much less than Q1 2020.
And lastly, if your revenues were down in Q4 2020 by just 20% compared to Q4 2019, then you may also be eligible for Q1 2021. There is a safe harbor provision that few advisors are talking about, and it means that many businesses are qualifying for $7,000 per employee in Q1 2021.
I know, it seems too good to be true, but the government wants to incentivize and reward you for keeping US residents employed and money flowing through our economy as we rebuild bigger and stronger than before.
You are most likely referring to a provision of the CARES Act that allowed employers to defer the deposit and payment of the employer’s share of Social Security taxes. Those deferrals must then be repaid – with at least 50% of the balance due by 12/31/21 and the remaining balance due by 12/31/22.
ERC credits are NOT a deferral. They are dollar-for-dollar credits against wages you’ve paid. Not taxes you’ve paid, but actual wages.
These credits can offset future tax contributions or you can receive a refund check – it’s your choice.
And you will NOT have to re-pay these funds (unless, of course, you don’t provide adequate documentation in the course of an audit).
Your banker, CPA, or Financialk Advisor was probably very helpful when it came to getting your PPP funds because they were effectively signing you to an SBA-guaranteed loan. The SBA paid the bank administrative fees based on the PPP loans they made, and so they were incentivized to educate you about the program and get all your paperwork in order.
Compared to the ERC, the PPP program was also a rather simple calculation. 2 ½ times your average monthly payroll including health insurance and state unemployment taxes.
From the conversations we’ve had with bankers, they have no interest in involving themselves in your employment tax compliance. For them it is a liability and beyond their scope of services.
Your Payroll Service does an excellent job of executing the fundamentals of paying your employees, paying your employment taxes and filing your quarterly reports.
But computing your ERC credits requires visibility into your P&L and PPP forgiveness applications. Not only that, but the complex requirements around eligibility and allocating ERC credits at the employee-level while accounting for annual and quarterly qualifying wage gaps and . . . well, you can probably tell why Payroll Services are not offering to do all of this for you.
The Payroll Services that we’ve worked with so far are happy to provide the payroll registers that we need to perform the allocations. And they are happy to file the Amended Form 941-X with the IRS on our client’s behalf.
But that’s the extent of it.
In fact, most wise Payroll Services are asking clients to sign an indemnification waiver before submitting a Form 941-X because the Payroll Service can take no responsibility for the accuracy of the ERC credits you are claiming.
For them to involve themselves in the intricacies of this calculation, it is a liability and beyond their scope of services.
Whether your tax accountant is a CPA or EA, he or she most likely only prepares your Federal and State Income Tax Returns. However, ERC credits are claimed against Employment Taxes on Form 941, and cash advanced through Form 7200.
The complexity of the ERC program is a beast unto itself and every tax accountant we’ve talked to has said they focus on staying up-to-date on the ever-evolving income tax code, and they can’t now become experts in the ERTC program as well.
If your tax accountant is comfortable determining your eligibility by quarter and year, computing your credits, and preparing contemporaneous documentation to support an IRS audit, then you should certainly let them handle all of this.
If you want a second set of eyes on this, we’re happy to take a look.
Your Bookkeeper should certainly have access to all the information that is needed for an accurate calculation of your legal ERC claim. They will have your financial reports, payroll registers, and PPP loan forgiveness documents.
The Million Dollar Question is . . . Do They Have The Time?
Do they have the time to dig into the text of American Rescue Plan Act of 2021
And its accompanying referenced laws like: CARES Act, Families First Act, Payroll & Healthcare Enhancement Act, PPP Payroll Flexibility Act and the Consolidated Appropriations Act.
Time to read the IRS Interpretations and FAQ’s? And cross-reference those definitions with that of PPP which was separately defined and dissimilarly interpreted in the Small Business Administration’s Bulletins and IFRs?
Do they have the time to ensure accuracy in eligibility determination, maximize your computation and create the supporting documentation you’ll need to support an IRS audit of employer taxes?
So far, we have not found a bookkeeper who is able to take all this on, while handling the day-to-day of bookkeeping. If yours can, then take them up on their offer. We’re happy to take a second look.
FAQs
The Coronavirus Aid, Relief, and Economic Security Act (also known as the CARES Act) was signed into law on March 27, 2020. It included two programs to assist businesses with keeping workers employed: the Payroll Protection Program (PPP) administered by the Small Business Adminstration and Employee Retention Credit (ERC) administered by the Internal Revenue Service.
PPP funds are distributed based on 2.5 months of payroll and a minimum of 80% of the funds must be used on payroll to be eligible for forgiveness. Additionally, PPP funds are not taxable as revenue and you may still take deductions for the payroll covered by PPP.
ERC tax credits, however, are credits (or refunds) for a percentage of payroll in each quarter that you qualify. There are specific rules for determining eligibility by quarter, and limiting the dollars that can be claimed for each employee.
Initially with the CARES Act, employers could choose to apply for PPP or claim ERC credits, but not both.
PPP was more beneficial than ERC for most businesses (for reasons we won’t go into here) and so most businesses with under 500 employees received forgivable PPP Loans.
On March 11, 2021, The American Rescue Plan Act of 2021 was signed into law and included many modifications and expansions to existing elements of previous stimulus programs.
Noteworthy modifications for business owners included:
Businesses who applied for and received PPP funds could now also claim ERC credits.
ERC credits could be retroactively claimed for businesses that qualified in 2020.
ERC credits were extended through 9/30/21 with lower qualification requirements.
The per-employee cap on qualifying wages increased from $10,000 for all of 2020 to $10,000 per quarter for the first 3 quarters of 2021.
The refundable credit amount increased from 50% of qualifying wages in 2020 to 70% in 2021.
So the short answer is “Yes” . . . you can claim ERC even if you received PPP funds.
Unlike the Payroll Protection Program (administered by the Small Business Administration), there is actually no “application process” for the Employee Retention Tax Credits.
You simply claim the ERC tax credit like you would any other tax credit – by asserting to the IRS that you can legally claim the credit.
When you claim a child tax credit, you do so by asserting this fact on your Form 1020 Personal Income Tax Return.
The difference is that when you claim an ERC tax credit, you do so on your Form 941 Employer Quarterly Tax Filing.
For prior quarters, you must file an amended form (the Form 941-X) to reduce your current quarter’s tax contribution and request a refund of excess credits (which is highly likely).
Another perk of ERC, is that since you can often estimate these credits in advance of distributing cash for payroll, you can file a Form 7200 to receive a cash advance to avoid waiting until the end of the quarter to apply for the refund.
Even though you may feel like revenue is back to normal, there are some items you want to consider before passing on this ERC assessment.
First, even if revenues have returned to “normal” in 2021, you may have qualified in 2020 and you can retroactively claim those credits. That eligibility criteria in 2020 was based on revenue declines from 2019, or if your business was partially or fully closed due to governmental mandate.
Second, while your revenue may have returned to “normal” in Q1 2021, remember that we are comparing your Q1 2021 to Q1 2019. If 2019 was a year of growth for your business, then your revenue levels 2 years ago may have been much less than Q1 2020.
And lastly, if your revenues were down in Q4 2020 by just 20% compared to Q4 2019, then you may also be eligible for Q1 2021. There is a safe harbor provision that few advisors are talking about, and it means that many businesses are qualifying for $7,000 per employee in Q1 2021.
I know, it seems too good to be true, but the government wants to incentivize and reward you for keeping US residents employed and money flowing through our economy as we rebuild bigger and stronger than before.
You are most likely referring to a provision of the CARES Act that allowed employers to defer the deposit and payment of the employer’s share of Social Security taxes. Those deferrals must then be repaid – with at least 50% of the balance due by 12/31/21 and the remaining balance due by 12/31/22.
ERC credits are NOT a deferral. They are dollar-for-dollar credits against wages you’ve paid. Not taxes you’ve paid, but actual wages.
These credits can offset future tax contributions or you can receive a refund check – it’s your choice.
And you will NOT have to re-pay these funds (unless, of course, you don’t provide adequate documentation in the course of an audit).
Your banker, CPA, or Financialk Advisor was probably very helpful when it came to getting your PPP funds because they were effectively signing you to an SBA-guaranteed loan. The SBA paid the bank administrative fees based on the PPP loans they made, and so they were incentivized to educate you about the program and get all your paperwork in order.
Compared to the ERC, the PPP program was also a rather simple calculation. 2 ½ times your average monthly payroll including health insurance and state unemployment taxes.
From the conversations we’ve had with bankers, they have no interest in involving themselves in your employment tax compliance. For them it is a liability and beyond their scope of services.
Your Payroll Service does an excellent job of executing the fundamentals of paying your employees, paying your employment taxes and filing your quarterly reports.
But computing your ERC credits requires visibility into your P&L and PPP forgiveness applications. Not only that, but the complex requirements around eligibility and allocating ERC credits at the employee-level while accounting for annual and quarterly qualifying wage gaps and . . . well, you can probably tell why Payroll Services are not offering to do all of this for you.
The Payroll Services that we’ve worked with so far are happy to provide the payroll registers that we need to perform the allocations. And they are happy to file the Amended Form 941-X with the IRS on our client’s behalf.
But that’s the extent of it.
In fact, most wise Payroll Services are asking clients to sign an indemnification waiver before submitting a Form 941-X because the Payroll Service can take no responsibility for the accuracy of the ERC credits you are claiming.
For them to involve themselves in the intricacies of this calculation, it is a liability and beyond their scope of services.
Whether your tax accountant is a CPA or EA, he or she most likely only prepares your Federal and State Income Tax Returns. However, ERC credits are claimed against Employment Taxes on Form 941, and cash advanced through Form 7200.
The complexity of the ERC program is a beast unto itself and every tax accountant we’ve talked to has said they focus on staying up-to-date on the ever-evolving income tax code, and they can’t now become experts in the ERC program as well.
If your tax accountant is comfortable determining your eligibility by quarter and year, computing your credits, and preparing contemporaneous documentation to support an IRS audit, then you should certainly let them handle all of this.
If you want a second set of eyes on this, we’re happy to take a look.
Your Bookkeeper should certainly have access to all the information that is needed for an accurate calculation of your legal ERC claim. They will have your financial reports, payroll registers, and PPP loan forgiveness documents.
The Million Dollar Question is . . . Do They Have The Time?
Do they have the time to dig into the text of American Rescue Plan Act of 2021
And its accompanying referenced laws like: CARES Act, Families First Act, Payroll & Healthcare Enhancement Act, PPP Payroll Flexibility Act and the Consolidated Appropriations Act.
Time to read the IRS Interpretations and FAQ’s? And cross-reference those definitions with that of PPP which was separately defined and dissimilarly interpreted in the Small Business Administration’s Bulletins and IFRs?
Do they have the time to ensure accuracy in eligibility determination, maximize your computation and create the supporting documentation you’ll need to support an IRS audit of employer taxes?
So far, we have not found a bookkeeper who is able to take all this on, while handling the day-to-day of bookkeeping. If yours can, then take them up on their offer. We’re happy to take a second look.
ERC Funds by Charles Bronson
Charles Bronson is a small business advocate, having worked for 30+ years in start-ups, SMBs, and even public companies with less than 150 employees. He sees that small businesses are the backbone of family life in the US, and this ERC cash recovery platform is "the best thing since sliced bread" for small business owners.
Charles Bronson is a small business advocate, having worked for 30+ years in start-ups, SMBs, and even public companies with less than 150 employees. He sees that small businesses are the backbone of family life in the US, and this ERC cash recovery platform is "the best thing since sliced bread" for small business owners.
© 2021 Charles Bronson Marketing. All Rights Reserved
© 2021 Charles Bronson Marketing. All Rights Reserved
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