Eligibility for businesses
Your business may be still eligible for up to $5,000.00 in ERC credits per employee during 2020 and up to $7000.00 per employee per quarter during 2021 Kept employees on payroll during 2020 and 2021
- Was at least partly closed due to a government order or you had a significant decline in revenue
- 2020 maximum benefit per employee - $5,000.00
- 2021 maximum benefit per employee - $21,000.00
What it is
Tax credit for businesses that kept employees on payroll during 03/12/20 to 09/30/21
How it works
- For 2020 the credit is 50% of the wages paid up to $10,000.00 per employee for the entire 2020
- For 2021 the credit is 70% of the wages paid up to $10,000.00 per employee for the 1st 3 quarters of 2021
- Recovery Start Up Businesses for the businesses that started operations after Feb 15, 2020.
To get started
If your business is eligible for the ERC for 2020 or 2021 and you have not yet claimed the credit, you can file amended payroll tax forms to claim the credit and receive your tax refund
Overview & Rules
To see whether your business is eligible for the ERC, start by determining whether:
- The business was fully or partially shutdown due to the government order during any part of 2020 or 2021, or
- The business gross receipts in any quarter of 2020 declined 50% or more relative to the same quarter of 2019,
- The business gross receipts in any quarter of 2021 declined 20% or more relative to the same quarter of 2019
If the answer to either question is YES, and the business had 100 or fewer employees during 2020 or had 500 or fewer employees during 2021, then any wages paid to any employee while the business was fully or partially shut down or during a quarter that it had a 50% in 2020 or 20% in 2021 decline in gross receipts may count towards to $10,000.00 per employee amount.
Recovery start up businesses can claim ERC credits for the last 2 quarters of 2021 up to $50,000.00 per Quarter
- You started your business on or after Feb 15, 2020
- Your annual gross receipts do not exceed $1 million for the individual 2020 and 2021 tax years
- You have one or more W2 employees, not including owner-operator or family members
- You can claim ERC even if you claimed PPP
- More than 50% owners and their relatives do not qualify for the credit