How To Claim ERTC - Employee Retention Tax Credit

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How to claim ERTC

As an employer, navigating the complexities of tax credits can be challenging. However, understanding and taking advantage of the available tax incentives can significantly benefit your business.

One available tax credit is the Employee Retention Tax Credit or ERTC. In this video, I will provide a comprehensive guide on how to claim the Employee Retention Tax Credit, outlining the necessary steps and important considerations for employers.

Understanding the Employee Retention Tax Credit:

The Employee Retention Tax Credit was introduced by the U.S. Congress as part of the CARES Act to support businesses impacted by the COVID-19 pandemic. The credit is to reward employers who retained their employees during the challenging economic times of 2020 and 2021.

Qualifying for the Employee Retention Tax Credit:

To claim the Employee Retention Tax Credit, employers must meet specific eligibility criteria. These include:

Employer Size: The credit is available to all businesses with 500 or fewer employees, including tax-exempt organizations and businesses that received Paycheck Protection Program (PPP) loans.

Impact of COVID-19: Employers must demonstrate that they experienced a decline in gross receipts or were subject to a full or partial suspension of operations due to government mandates related to COVID-19.

Retaining Employees: Employers needed to retain their employees and paid payroll taxes on them during the eligible period which is quarters 2-4 of 2020 and quarters 1-3 of 2021.

How To Claim ERTC:

To claim the Employee Retention Tax Credit, employers need to follow these steps:

Review Eligibility: Determine if your business meets the eligibility requirements outlined by the IRS. Evaluate the decline in gross receipts and any applicable government orders impacting your operations.

Calculate Qualified Wages: Identify the wages paid to eligible employees during the eligible period. Qualified wages include certain health plan expenses and can differ depending on the number of employees.

Determine Credit Amount: Calculate the amount of the tax credit you are eligible to claim. The Employee Retention Tax Credit is equal to a percentage of qualified wages, up to a maximum amount of $26,000 per employee.

File the Appropriate Forms: Employers claim the Employee Retention Tax Credit by filing Form 941, Employer's Quarterly Federal Tax Return. Make sure to complete the designated sections related to the credit accurately.

Seek Professional Assistance: Due to the complexity of tax regulations, it is advisable to consult with a qualified ERTC specialist who can guide you through the process and ensure compliance with all requirements.

Important Considerations:

While claiming the Employee Retention Tax Credit, keep the following considerations in mind:

Documentation: Maintain proper documentation of the eligible period, decline in gross receipts, and relevant employee information to support your claim.

Conclusion:

The Employee Retention Tax Credit provides valuable financial support to businesses affected by the COVID-19 pandemic. By understanding the eligibility requirements, calculating qualified wages, and following the necessary steps to claim the credit, employers can effectively leverage this tax incentive. Remember to consult with an ERTC professional to ensure accuracy and compliance. With careful consideration and proper documentation, businesses can successfully claim the Employee Retention Tax Credit and mitigate the financial impact of the pandemic.

This is not a loan or a government handout. This is a refund of money you already paid in payroll taxes and your business may be eligible to receive up to $26,000 per employee.

The thing is you're busy running your business and this process has to be done correctly by an ERTC specialist. Why not let the people who are ERTC specialists handle the filing and paperwork for you?

But beware of scammers! If the ERTC company you're working with wants you to pay up front, run the other way. That's why I recommend the Linqqs ERTC specialists, they are former IRS agents who know how to file everything correctly and you don't pay until you've been paid.

Click the link below this video to find out if you qualify to clawback some of the payroll taxes you paid in 2020 and 2021. Your business may be eligible for a refund of up to $26,000 per employee.