Was your business able to continue retaining W2 employees during the COVID 19 Pandemic?
You may qualify for the Employee Retention Credit (ERC) as a part of the CARES Act to encourage employee retention. The ERC is a fully refundable payroll tax credit created to provide financial relief for American businesses impacted by the pandemic. In order to incentivize businesses to preserve jobs, the ERC tax credit offsets the quarterly employment taxes business are required to pay.
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Wasn't this last year?
The ERC tax credit was not widely used until March 2021, when updated IRS regulations made this type of COVID-19 Relief more accessible. In short: thousands of businesses who once picked between the Paycheck Protection Program (PPP) and ERC can now possibly use both, by amending their 2020 Quarterly Form(s) 941. At the Dayes Law Firm our Attorneys have an . An LL.M. requires additional schooling in a specific field beyond what it takes to earn a law degree. This specialized education in Taxation helps our attorneys understand how the IRS is thinking when handling your specific case.
Who is eligible for ERC?
In order to determine if you qualify for the ERC it is important to look at the following criteria. At the Dayes Law Firm, our attorneys have experience helping businesses determine if they are able to qualify for the Employee Retention Credit (ERC). If you believe that your business fits the qualifications below it is important to call our firm as soon as possible, we have attorneys ready to help you.
- Your operations must have been fully or partially shut down, OR had to enforce reduced business hours because of the governmental authority.
- Your business suffered a significant decline in quarterly gross revenue when measured against 2019.
- At least a 50% decline from 2019 to 2020
- At least a 20% decline from 2019 to 2021
- Recovery Startup Business- 3rd and 4th quarter 2021 only.
- Your business began carrying on trade or business after February 15, 2020.
- Your business has annual gross receipts that do not exceed $1 million
- Your business is not eligible for the ERC under the other two categories.
What are the date ranges being considered for eligible wages under the ERC?
Between March 2020 and December 2021 there are a number of acts that have been passed in order to make the ERC eligible for businesses. Our team of Attorneys at the Dayes Law Firm can properly assess your tax filings and determine your ERC eligibility based on the following timeline. If you believe that your business is eligible within any of these acts contact Dayes Law Firm today.
- March 13, 2020- December 31, 2020- CARES Act
- January 1, 2021- June 30, 2021- Consolidated Appropriations Act
- July 1, 2021- September 30, 2021- American Rescue Plan Act
- July 1, 2021- December 31, 2021- Recovery Startup Business
When is the ERC Filing Deadline?
Businesses have the ability to claim the Employee Retention Tax Credit retroactively. Tax law states that the statute for payroll taxes begins on April 15th of the year following when the calendar quarter ends and it continues for three years. That would give your business until April 15, 2024, for 2020 ERC claims and April 15, 2025, for 2021. Although ERC is retroactive it is important that you file your amended taxes as soon as possible to ensure that your business gets proper compensation. If you believe that your business qualifies for the ERC tax credit contact the experienced tax attorneys at Dayes Law Firm today.
Employee Retention Tax Credit Example Calculations
2020 Employee Retention Credit Example:
Your business pays Mitch $9,000 wages and healthcare in quarter 2, $7,000 in quarter 3 and $7,000 in quarter 4 of 2020. In this case your Employee Retention Tax Credit fo Mitch is $5,000 in Quarter 2, $2,000 in Quarter 3, and $0 in Quarter 4. There is a cap of $5,000 for each employee under the Employee Retention Tax Credit so any additional wages you pay Mitch will not increase your credit amount.
2021 Employee Retention Credit Example:
Your business pays Kyle $7,000 Quarter 1, $9,000 in Quarter 2, $11,000 in Quarter 3 and $11,000 Quarter 4 of 2021. Your Employee Retention Tax Credit will be capped at $7,000 for each quarter in 2021.
Call our Employee Retention Tax Credit Lawyers Today?
Your business may be eligible to receive an Employee Retention Tax Credit from the IRS if you continued to pay employees through the COVID 19 pandemic, especially in the 4th quarter of 2020 and the 3rd Quarter of 2021. If you believe that your business might meet the requirements for the Employee Retention Tax Credit due to shutdowns, revenue decline, or suspended operations. Our team of experienced tax attorneys is able to determine if your business is eligible for the ERC tax credit and file the appropriate amended quarterly payroll tax returns on your behalf to claim your funds. Contact Dayes Law Firm today and find out if you qualify for the ERC tax refund today. Our team of experienced and knowledgeable tax attorneys is ready to help you claim the tax incentives your business is entitled to. Call today for a no-obligation-free consultation.
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