Due to COVID-19 negatively impacting businesses nationwide, there are a number of coronavirus payroll tax credits available to help employers out. One option is the Employee Retention Credit (ERC).
The ERC is a CARES Act relief measure that encourages businesses to keep employees on their payroll. It is a refundable payroll tax credit based on the qualified wages an eligible employer pays to employees. Eligible employers include businesses, tax-exempt organizations, and certain governmental entities.
When signed into law, the ERC was equal to 50% of qualified wages eligible employees paid between March 13, 2020, through December 31, 2020. However, thanks to the Consolidated Appropriations Act (CAA), employers who qualify in 2021 – including employers who received a PPP loan – can now claim a credit against 70% of qualified wages paid through December 31, 2021.
As you prepare to claim the ERC, be sure that you have the resources you need to successfully complete the process. Our team at Meaden & Moore has developed the following resources for reference:
If you have any questions or would like to be walked through these resources, please contact us after downloading them.