What is the Employee Retention Credit?
The Employee Retention Credit (ERC or ERTC) was created as part of the CARES Act to encourage businesses to continue paying employees by providing a credit to the eligible employer for wages paid to eligible employees. The refundable credit is available from March 13, 2020, through September 30, 2021, and can be utilized even if companies received PPP loans. Businesses that started up after February 15, 2020, are eligible for up to $100,000 of credits on wages paid from July 1, 2021, through December 31, 2021.
It's not too late to still claim your ERC tax credit.
KBKG is providing the following services to assist with ERC:
- Determine if the employer qualifies, and if so, for which quarters
- Determine which employee wages qualify
- Calculate credits, including analysis of PPP interplay
- Reconcile actual credits with advance credits requested
- Prepare reconciled data for Form 941-X
- Prepare documentation supporting eligibility
Recipients of PPP loans are now eligible to qualify retroactively for the credit in 2020 and 2021.
For 2021, there is a maximum credit of $7,000 per eligible employee, per quarter. The 2021 credit is computed at a rate of 70% of qualified wages paid, up to $10,000 per eligible employee, per quarter. For Eligible Employers with less than 500 average full-time employees in 2019, the credit is available for all employees receiving wages in 2021.
For 2020, there is a maximum credit of $5,000 per eligible employee. The 2020 credit is computed at a rate of 50% of qualified wages paid, up to $10,000 per eligible employee for the year. For Eligible Employers with less than 100 average full-time employees in 2019, the credit is available for all employees receiving wages in 2020.
Work with a Trustworthly
Listen to this message from ERC Expert Jason Melillo to CPAs stressing the importance of being wary of ERC mills.
An Eligible Employer (including all members of a control group) must meet one of the following criteria:
Additional rules and limitations apply.
Employee Retention Tax Insights
Withdrawal of ERC Claims: A Comprehensive Guide for CPAs Thought Leadership by Ian Williams, Director | KBKG In IRS notice, IR-2023-193, released this week, the IRS has taken a significant step to protect small businesses and organizations from potential scams related to the Employee Retention Tax Credit (ERC) by introducing a novel withdrawal process. This process is designed … Read More
New Questions People Are Asking About ERC Thought Leadership by KBKG Originally published 5/1/2023, updated 10/10/2023 On September 14th, 2023, the IRS took the significant step of suspending the acceptance of new ERC claims until at least December 31st, 2023. This was in response to mounting concerns about the integrity of the Employee Retention Credit … Read More
KBKG’s ERC Guidance for CPAs and Tax Professionals Thought Leadership by KBKG Regarding the latest IRS rules and regulations on the Employee Retention Tax Credit program, it’s paramount for Certified Public Accountants (CPAs) and Tax Professionals to stay ahead of the curve. The Internal Revenue Service (IRS) recently introduced a moratorium on processing Employee Retention … Read More
Advice for Taxpayers About the ERC Moratorium Thought Leadership by Ian Williams, Director | KBKG The Employee Retention Tax Credit (ERC) is a complex tax credit created by the Coronavirus Aid, Relief, and Economic Security (CARES) Act in 2020 to help businesses keep their employees on the payroll during the COVID-19 pandemic. The ERC is … Read More
Navigating the New Phase of Employee Retention Credits (ERC) By Ian Williams, Director | Employee Retention Tax Credits KBKG As Certified Public Accountants (CPAs), staying current with tax regulations is a top priority. In recent times, the Employee Retention Credit (ERC) program has undergone significant changes. The Internal Revenue Service (IRS) Commissioner’s latest signals have … Read More
IRS Pauses New Claims for Employee Retention Credit Program Thought Leadership from KBKG, Sep 15, 2023 In response to mounting concerns about the integrity of the Employee Retention Credit (ERC) program, the Internal Revenue Service (IRS) has taken the significant step of suspending the acceptance of new ERC claims until at least December 31, 2023. … Read More
Supply Chain Disruption – How to Get Compliant for the ERC Thought Leadership on Employee Retention Credit by Ian Williams, DIRECTOR | KBKG In response to widespread abuse and negligence in the due diligence process related to employee retention credit eligibility (ERC or ERTC) via supply chain disruption, IRS Chief Counsel issued a generic legal advice … Read More
ERTC Eligibility for Supply Chain Disruption By Ian Williams, Director, Research & Development Tax Credits and Employee Retention Credits | KBKG The IRS Chief Counsel recently published a Generic Legal Advice Memorandum (GLAM), providing guidance on the eligibility criteria for the Employee Retention Credit (ERC or ERTC) in cases where employers claimed government shutdown qualification via shutdowns of … Read More
The Dangers of Inaccurate Filing Deadlines for the ERC Thought Leadership by KBKG Beware of Dubious Tax Advisors Tax season can be stressful for individuals and businesses alike, as the intricacies of tax laws and regulations can often be overwhelming. Unfortunately, unscrupulous tax advisors take advantage of this confusion, employing dubious tactics to market inaccurate … Read More
A Guide to Filing Form 941-X for Employee Retention Credits Thought Leadership by KBKG If you believe your company is eligible to receive the Employee Retention Credit, the good news is that qualifying companies have until April 15, 2024 for the 2020 credit and April 15, 2025 for the 2021 credit, to file. However, to … Read More