Avoid Common Mistakes Businesses Make When Claiming the ERTC

July 25, 2023
Dayes Law Firm

The Employee Retention Tax Credit, sometimes called the ERC or ERTC, has been a financial lifesaver for many businesses. Business owners who have not yet taken advantage of this amazing tax credit may be worried about errors in the application process that could lead to a dreaded IRS audit. But there are ways to avoid common mistakes businesses make when claiming the ERTC, and we want to help your business with the process if we can. 

All About the ERTC

The ERTC was initially put in place as a temporary program to assist businesses in keeping employees on payroll despite the economic uncertainty of the early COVID-19 pandemic era. In short, it’s a refundable tax credit businesses can claim for qualified wages paid to their employees during specific time periods.

The Employee Retention Tax Credit was first available for wages paid from March 13, 2020, to December 31, 2020, and was later extended to include wages through December 31, 2021. 

The exact qualifying factors to apply for the ERTC are more complicated than this, but in general, employers are eligible to claim the credit if their business experienced either a full or partial suspension of the operation of their business during certain 2020 and 2021 quarters due to government orders restricting specific activities, or if the business had a substantial drop in gross receipts as compared to the same 2019 quarter. 

Common Mistakes Businesses Make When Claiming the ERTC

While all the advertisements you may have seen about claiming the ERTC might make it seem easy, anything involving taxes has some degree of complexity. As a business owner, there are certain mistakes you’ll definitely want to avoid when claiming the ERTC so you avoid the wrath of the IRS

One common mistake is assuming you qualify for the ERTC when you and your business may not actually be eligible under specific Employee Retention Credit guidelines. Or, alternatively, you might think your business didn’t experience enough of a decline in gross receipts to apply. 

You might also think that you have too few employees to apply for the ERTC – or too many! Plus, some business owners may think that they didn’t actually “shut down” enough to be qualified to apply for these funds, or they might believe that because they already received Paycheck Protection Program (PPP) loan assistance, they can’t also apply for the Employee Retention Tax Credit.

The best way to avoid mistakes many businesses make when claiming the ERTC is to get the help of a skilled team of tax professionals on your side. The team at Dayes Law Firm and our partners can offer you assistance with the ERTC if you haven’t already applied, and we’ve already been involved in filing for more than $250 million in refunds on behalf of many businesses!

You can also choose to pursue the process alone, and in that case, we would suggest doing a heavy amount of research to make sure you have all the documentation you need to claim the ERTC and avoid the IRS flagging your application

By choosing to turn to an ERTC team like the one at Dayes Law Firm instead, you’ll have the peace of mind of having an experienced tax professional in your corner and get our robust defense against an ERTC IRS audit, too.

You can avoid making mistakes when claiming the ERTC and putting together your tax credit documentation simply by turning to a team that knows the entire process from start to finish! Dayes Law Firm can offer a no-obligation, free consultation to discuss your ERTC options with you, and we would be more than happy to do so.

Please contact us by giving us a call or filling out the form on this page to see how the team at Dayes Law Firm can help you and your business when claiming the ERTC today.