The Employee Retention Credit (ERC) is a valuable resource for businesses that have been impacted by the COVID-19 pandemic. This tax credit is designed to provide financial assistance to eligible businesses so that they can retain their employees during these difficult times. In this blog post, we'll discuss how the ERC can help your business, what you need to know before filing for the credit, and why it's important to work with an experienced lawyer to help you file your claim.

How can the Employee Retention Credit help your business?

The ERC is a tax credit that provides financial assistance to businesses that have been impacted by the COVID-19 pandemic. This credit can help you retain your employees by providing you with a credit of up to $5,000 per employee for wages paid between March 13, 2020, and December 31, 2021. The credit is calculated as 70% of qualified wages paid to eligible employees, up to a maximum of $10,000 per employee per quarter.

Who is eligible for the Employee Retention Credit?

To be eligible for the ERC, your business must have experienced either a full or partial suspension of operations due to a government order related to COVID-19, or a significant decline in gross receipts compared to the same quarter in the previous year. Businesses with 500 or fewer employees are eligible for the ERC.

What do you need to know before filing for the Employee Retention Credit?

While the ERC can provide much-needed financial assistance to eligible businesses, it's important to understand the rules and regulations that apply to the credit. For example, you cannot claim the ERC if you have received a Paycheck Protection Program (PPP) loan. Additionally, you cannot claim the ERC for wages that were paid with funds from a federal grant or other COVID-19 relief program.

Why is it important to work with an experienced lawyer to help you file your claim?

Filing for the Employee Retention Credit can be a complex and time-consuming process. Working with an experienced lawyer can help you navigate the rules and regulations surrounding the credit and ensure that your claim is filed correctly. A lawyer can help you identify eligible employees, calculate the amount of the credit you're entitled to, and ensure that all necessary documentation is included with your claim.