Employee Retention Credit
It’s 2023, but you still have the chance to qualify for the employee retention credit (ERC) for the 2020 and 2021 calendar years. This credit can potentially help you recover a significant amount of money.
The employee retention credit (ERC) is a refundable tax credit against certain employment taxes. To claim this credit, it is necessary to amend your payroll tax returns for 2020 and 2021. While this might seem like a cumbersome process, the financial benefits can make it well worth the effort.
For instance, if your business has 12employees and meets the qualifications for maximum tax credits, you could receive a total of $312,000 in ERC.
There are two primary routes to qualifying for the employee retention credit (ERC):
1. A decline in gross receipts. The most straightforward way to qualify is by demonstrating a decline in your gross receipts during the years 2020 and 2021. It is important to note that the decline does not have to be directly caused by COVID-19.
2. Government order causing more than a nominal effect. If a government order caused your business to fully or partially shut down, you might qualify for the ERC for the wages paid during the shutdown period.
The deadline to claim the ERC for 2020—April 15, 2024—is about 10 months away. We strongly recommend that you act promptly to maximize your potential benefits from this program.
The Sterling Standard
Sterling Tax and Accounting is here to help your business with tax planning and the employee retention credit (ERC)! Our comprehensive approach to tax planning helps reduce your overall tax liability.
If all your accountant does is file your taxes, chances are they are making you pay more than your fair share of taxes.
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