While the worst of the COVID-19 pandemic is hopefully behind us, many businesses are still recovering from the government lockdowns, social distancing guidelines, and huge hits to the economy the pandemic caused. Medical practices were on the frontlines of the pandemic, and many are just now easing back into a normal patient load.
The Employee Retention Tax Credit (ERTC) can help a wide range of businesses, including healthcare practices, combat COVID-19-related economic challenges. Learn the benefits of the ERTC for medical practices below.
Financially Make Up for Medically-Related COVID Shutdowns
While many medical practices experienced swarms of patients as they provided treatment for COVID-19 symptoms and administered vaccines, other healthcare practices were forced to close during the pandemic.
Government orders paused elective medical procedures for several months. Many outpatient clinics shut down entirely during these lockdowns, struggling to pay employees their normal wages.
For those medical practices that stayed open, other challenges abounded, such as:
- Mandatory cleaning procedures that cut into patient capacities
- Waiting room capacity restrictions under social distancing guidelines
- Patient capacity restrictions for open-room medical practices, such as physical therapy gyms
- Personal protective equipment shortages
- Employee sicknesses and COVID-19 protocols that required infected employees to take weeks-long leaves
These challenges placed a huge financial toll on healthcare organizations. However, the ERTC for medical practices provides additional funding that practices can use to replenish the financial losses they incurred from the pandemic.
The deadline to file for the ERTC isn’t until April 15, 2024, for 2020 tax returns and April 15, 2025, for 2021 tax returns. Your practice still has time to claim this credit.
Reward Employees for Hard Work Throughout the Pandemic
While some healthcare practices were subject to a full or partial suspension of procedures during stretches of the pandemic, practices like urgent care clinics and hospitals were swamped with patients experiencing COVID-19 symptoms and needing treatment. Many practices didn’t have enough beds for the patients requiring assistance, yet they didn’t want to turn anyone away. These working conditions placed an enormous strain on healthcare workers.
During the worst pandemic periods, hospitals didn’t have many extra resources to thank these workers properly. Now, practices can apply for the ERTC and use the funds they secure to reward their workers.
The ERTC can give you a credit of up to $26,000 per employee for qualified wages paid during 2020 and 2021, depending on the number of full-time employees. Returning some or all of this credit to employees would go a long way toward thanking them for their commitment.
Hire New Talent To Combat Staffing Shortages
Numerous healthcare practices are still experiencing staffing shortages years out from the pandemic. These shortages have a range of causes, but one thing is clear: Candidates are motivated by high wages. Many nurses would rather work travel positions where they earn two or three times the amount they make in a regular full-time position.
With the ERTC, your healthcare practice can afford to hire new talent at elevated wages, helping to make up for staffing shortages.
Moratorium Leads to Greater Scrutiny of Filed Claims
In September, the IRS announced “an immediate moratorium through at least the end of the year on processing new claims for the pandemic-era relief program” as a result of increased fraud concerns.
IRS Commissioner Danny Werfel noted in the announcement, “The IRS is increasingly alarmed about honest small business owners being scammed by unscrupulous actors, and we could no longer tolerate growing evidence of questionable claims pouring in,” and urged that when it comes to claiming the credit, “businesses should seek out a trusted tax professional who actually understands the complex ERC rules.”
Seek ERTC Assistance From Qualified Tax Attorneys
If your medical practice has already claimed other tax credits and benefits through the Paycheck Protection Program or the Consolidated Appropriations Act, you may assume you don’t qualify for the ERTC. However, many medical practices qualify for more than one tax credit.
Don’t lose out on credits that could help your practice financially recover from the pandemic. Turn to Dayes Law Firm for personalized assistance understanding your eligibility for the ERTC and filing your claim. Call 866-567-4510 today for your free consultation about the ERTC for medical practices.