Extended Retention Tax Credit
There has been a lot of recent buzz about the Employee Retention Tax Credit (ERTC) through radio ads and phone calls business owners have been receiving from firms claiming to be able to help you claim back money through the credit. So, what is it? Is it possible that your business qualifies? And should you trust those phone calls and radio ads?
The ERTC is a payroll tax credit introduced in 2020 to encourage employers to keep their employees through the COVID-19 pandemic. These credits are claimed via quarterly or annual employer payroll returns, whichever applies to a given entity.
In general, to be eligible to claim the credit for any quarter in 2020 or 2021, employers must meet one of two criteria:
Operations were fully or partially suspended due to government orders during the calendar quarter.
There was a significant decline in gross receipts during the calendar quarter as compared to 2019.
We advise you to be wary of scams. There have been ads on the radio and phone calls targeting business owners in recent weeks claiming to be able to help recoup tens of thousands of dollars through the credit. Most of these companies charge high upfront fees and are charging employers a percentage of the refunds, if they are able to obtain them through the amended payroll returns.
If you believe your business may qualify for the credit, please reach out to either your payroll provider or our office. We would be happy to help you determine if you qualify and assist in preparing your amended payroll returns.