Understanding the Employee Retention Credit and How to Get Paid

The Employee Retention Credit (ERC) is a fully refundable tax credit that eligible employers can request to cover certain payroll taxes. It's not a loan and doesn't have to be repaid. In most cases, the refundable credit exceeds the payroll taxes paid in a credit-generating period. ERC Today is an Employee Retention Credit service that helps companies assess their eligibility, complete a thorough analysis of their applications, provides guidance on the application process and documentation, offers specific experience in programs that a regular CPA or payroll processor might not know well, and executes a quick and simple process from start to finish, from eligibility to applying and receiving refunds.

The Consolidated Appropriations Act expanded the requirements to include companies that applied for a loan under the Paycheck Protection Program (PPP), including borrowers from the initial round of the PPP who were not originally eligible to apply for the tax credit. All salaries that are subject to FICA taxes qualify, and you can include qualifying health expenses when calculating the tax credit. If you have already filed your tax returns and now realize that you are eligible for the ERC, you can request them retroactively by filling out the employer's adjusted quarterly federal tax return (941-X). The notice includes guidance on how employers who received a PPP loan can retroactively apply for the Employee Retention Tax credit.

This law allowed some employers most affected by financial difficulties to be able to claim the credit against the qualified salaries of all their employees, rather than just those who did not provide services. If you have problems applying for the ERC, it may be useful to consult with a tax professional. The ERC provides eligible employers with payroll tax credits for the salaries and health insurance they pay to employees. In addition to the Employee Retention Credit services offered by ERC Today, Aprio works with other credits to increase company liquidity.

Leave under the FFCRA included paid sick leave and family leave, which, when taken under the provisions of the law, offered businesses the opportunity to apply for a tax credit. The ERC is a valuable tax relief measure for both employers and employees, and can help retain key staff during these difficult times. This means that employees will not have to pay any additional taxes on the salaries covered by the ERC. To apply for credit for previous quarters, employers must file Form 941-X, Employer's Adjusted Quarterly Federal Tax Return or Request for Refund, for the applicable quarters in which qualifying wages were paid.

This law increased the employee limit to 500 to determine what salaries are applicable to the credit. Getting an initial estimate from ERC Today is free of charge and requires minimal investment of time up front. Use their secure portal to upload your 941 statements, PPP loan documents, and raw payroll data. With their help, you can quickly understand your eligibility for this tax credit and receive refunds in no time.