ERTC Eligibility

WHAT is the ERC or ERTC?

The Employee Retention Tax Credit (ERTC) is a valuable tax incentive that was introduced as part of the Coronavirus Aid Relief and Economic Security (CARES) Act in March 2020. It was designed to help businesses retain their employees during the challenging economic times caused by the COVID-19 pandemic and to encourage employers to keep employees on their payroll, instead of offset revenue losses. The ERTC provides eligible employers with a refundable tax credit for a portion of the wages paid to their employees. The maximum credit available per employee is $26,000.00.

The requirements are different depending on the time period for which the business qualifies for the credit.

WHO is eligible? 

Businesses that paid wages/compensation subject to FICA taxes are eligible. The wages cannot be for majority owners or their relatives.

The Consolidated Appropriations Act (CAA) issued in December 2020 extended and greatly enhanced the ERTC, allowing businesses to participate in both the PPP program and the ERTC. It is important for businesses to understand that they can still take advantage of the ERTC even if they have received a PPP loan. While businesses cannot claim the ERTC for wages that were paid with forgiven PPP loan proceeds, they can still claim the credit for wages that were not covered by the loan. 

Not sure if you are eligible? Contact us.