The Employee Retention Tax Credit

The ERC is available to any employer no matter how big or small. So long as they have the above qualifications.

Even if you don’t pay taxes, you can still qualify for relief. The purpose of ERC is to reward businesses that kept their doors open and people employed despite the unknown. So long as your business was negatively impacted financially by the COVID-19 pandemic, you most likely qualify.

Only federal, state, and local government entities are ineligible businesses.So good news is, most do! If you’re still unsure - let’s connect and see, just in case. We don’t want you to potentially leave money on the table!

- If you are a business that had to partially or fully suspend operations due to COVID-19

- Your business has a 20% or more decline in gross receipts in any quarter in 2021 compared to the same quarter in 2019 (or 50% in 2020 compared to 2019)

- You started a new business (or trade within your business( after February 15th, 2020 and have less than $1M in revenue.

You qualify! Not sure, let’s connect and see if we can help!

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Qualified wages are compensation provided to employees during an eligible period (including healthcare expenses).  An eligible period is either:

• the time during which the trade or business is fully or partially suspended by a governmental order, or 
• for 2020, any calendar quarter during which gross receipts are 50% less than the amount received during the same quarter of 2019; for 2021, any calendar quarter during which gross receipts are 20% less than the same quarter of 2019

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The IRS has extended the ERC support through to 2024. Let’s get moving!

Yes! The only caveat there is any wages paid with Paycheck Protection Program (PPP) funds are not considered ‘qualified wages.’ This is just so you are not “double-dipping.”

A business qualifies as a Recovery Startup if they meet the following criteria:

• You started your business on or after February 15, 2020.
• Your average annual gross receipts don’t exceed $1 million

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We actually wrote a whole blog on how TaxTaker can partner with your CPA to help you. In a nutshell, ERC is a very specific, niche and temporary (yes, it’s going away!) tax credit. Think of it like going to a general practitioner versus a specialist for your healthcare; both partner with you to provide the best outcome possible.

That’s great you’ve found someone amazing! TaxTaker are not here to replace your CPA - we are here as a tax specialist to partner with them to make them stronger! In fact, we partner with countless CPAs to help their clients get more money back. Read our blog on our partnership with CPAs for more!

Depending on which provision a business qualified under, the following documentation might be needed:

• Copy of any PPP Forgiveness applications
• 2019 to 2021 quarterly financials
• Related government shutdown orders
• Forms 941 (employers quarterly federal tax return)
• Payroll data for 2020 and/or 2021

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Did you know that less than 1% of startups get audited? Don’t let your fear of potentially being audited stand in the way of your business getting back thousands (or tens of thousands) of dollars. Claiming ERC tax credit will not increase your chances of being audited. 

If your business hit the jackpot and you get audited - don’t sweat! First of all, the TaxTaker are experts and we stand behind our quality of work and you have nothing to fear! We are here to support you in any way.

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Working with TaxTaker is risk free! TaxTaker collects a success fee only if you qualify for a tax credit. Our full fee is due upon completion of services.