The Employee Retention Credit (ERC) for many has been far more lucrative than the Paycheck Protection Program (PPP) loans that they received during 2020/2021. At the beginning of the pandemic, many employers were confused about the Employee Retention Credit due to the interplay when it came to the Paycheck Program Program. For the better part of 2020, employers were not eligible for the ERC if they received a PPP loan. With this in mind, many employers removed the thought of receiving the ERC from their train of thought and moved on. Until...
The Consolidated Appropriations Act (CAA), signed by President Trump on December 27, 2020, made significant enhancements to the ERC, including extending availability to the first two quarters of 2021, increasing the credit from 50 percent to 70 percent, and allowing it to be claimed in each quarter and reducing the 50 percent decline in revenues requirement to 20 percent (compared to the same period in 2019) as well as increasing the employment threshold from 100 employees to 500 to be eligible to obtain the credit for all employees rather than just those employees not working. Importantly, the CAA allows PPP loan recipients to claim the ERC, retroactive to the effective date of The CARES Act, March 27, 2020, although the same wages cannot be counted for both.
A local pizza chain in Michigan reached out to ERT Credit and made it clear that they attended several webinars about the credit put on by the National Restaurant Association (NRA) and were interested as they thought they clearly qualified for the ERC. However, when they called their accountant, it was noted that he was not sure the pizza chain qualified. Fast forward to a phone call with ERT Credit and it was clear that they not only qualified for the credit, but their credit was going to be sizable due to the number of locations and employees they had. After hearing the news, ownership engaged ERT Credit and the computations for all locations were underway. Later in the week, ERT Credit contacted ownership and informed them that they would be receiving a future-altering $1,721,269.58 back from the Internal Revenue Service (IRS). In the words of ownership, "All the blood, sweat, and tears has finally paid dividends."
ERT Credit has calculated the ERC credit for hundreds of employers across the country and continues to actively process both computations and amended returns for employers. Click here to reach out to us for more information.