The pandemic was a tough time for most business owners. With lockdowns across many states and a...
The pandemic changed the way we operated our businesses. Retaining employees through the lockdowns was tough, and many companies were forced to undergo mass layoffs. However, with rising unemployment, the government decided to step in and give small businesses relief so they could keep their hardworking employees.
If you’re a business owner who retained workers during the pandemic, you can now redeem some much-needed relief to help your business grow. The IRS announced a special program that gave small businesses a tax credit for each employee that was retained. This gives you the capacity to keep your workers on board.
As business owners ourselves, we understand you may have a hard time figuring out how this program works. However, we’re here to make it easier for you with our article. It covers all the basics of the Employee Retention Tax Credit Program. Furthermore, we’re also going to introduce a company you can work with to claim your credits.
Continue reading this article to claim your credit immediately.
What Is Employee Retention Tax Credit?
Small businesses had a tough time keeping their doors open during the pandemic. As more and more businesses were shutting down, the government decided to step in. They launched the Employee Retention Tax Credit Program in an attempt to help businesses stay afloat and retain their employees.
The program was just one of the schemes under the CARES Act Relief package. The relief package targeted small businesses to help them run during the lockdown. Many businesses lost more than 50% of their sales in a few weeks, making it hard for them to keep many of their employees.
The Employee Retention Tax Credit was a tax credit offered to certain small businesses that met the eligibility criteria. Since the companies had to pay fewer taxes, they could pay their employees, retaining them through the pandemic until business resumed back to normal. Lastly, the employee retention credits were offered from March 2020 to 2021.
What Were The Eligibility Criteria For The Program?
Not all small businesses were eligible for the Employee Retention Tax Credit program. The IRS laid out a plan for small businesses to continue operating despite a loss in revenue. You had to meet a few requirements to qualify for the ERTC tax credit.
Here are some of the requirements needed to qualify for the Employee Retention Tax Credit Program:
- You were forced to shut down by the local government between 2020 and 2021
- Your company’s gross receipts for a quarter in 2020 fell by half compared to the same quarter in 2019 (In 2020)
- Your company’s gross receipts for a quarter in 2020 fell by 20% compared to the same quarter in 2019 (In 2021)
In 2021, the second year of the program, the eligibility criteria were bumped so only deserving businesses could get the benefits. If your business meets the criteria, you are eligible to receive your tax break, so contact a financial advisor today!
Which Employees Could You Claim?
One important thing to note is that companies with fewer than 100 employees could claim credits for employees who were working and not working. However, companies with more employees could only claim credits for employees who didn’t work during that period.
How Does The Employee Retention Tax Credit Program Work?
While many people think the ERTC was fairly complicated, that is not true! The package was part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Moreover, since the act was directed at small businesses, a lot of employers would be able to save costs by claiming the tax credit.
Despite its benefits, the program was temporary. It ended in 2020; however, there are several ways you can still claim your ERTC today.
How To Claim Your ERTC?
Usually, business owners have a tough time collecting their ERTC. However, the next section in this article explains just that. If you run a business that met the ERTC qualifications and was severely affected by COVID-19, you are eligible to receive the tax credits.
The next step would be to claim a tax credit against your Social Security payroll tax. Many people have a hard time calculating their credits; however, it's pretty simple. The amount of tax credit you'd receive would be 50% of your employee's wages, and the credits were capped at up to $10,000 in total.
Even though it has been two years since the program commenced, you can still claim your ERTC credits. If you want to claim yours, we recommend talking to a trustworthy financial consultant, but more on that later.
To claim your credits, you will need to fill in the 941-X form, which is valid for up to three years after filing. If you want to claim your credits, you will need to hurry. You have till April 15, 2024, to claim your tax credits before the program ends completely.
How Long Does The Process Take?
Once you’ve filled out the necessary forms and are deemed eligible, the process could take between six weeks and six months. However, many businesses are reporting delays due to the extensive process of revising payroll reports.
Work With The Platinum Group To Claim Your ERTC
Running a small business is challenging; however, with companies like The Platinum Group, you can make your life a lot easier. If you want to claim your Employee Retention Tax Credit, there is no better company than TPG.
As their client, you can be assured that your work will be delivered on time, every time. They have experienced staff to handle any queries you may have about the process. Furthermore, signing up for their services is easy too. Just fill out the form on their website, and you will be contacted by their representatives immediately.
Your satisfaction is our priority, so don’t wait too long before contacting us at 909.466.7876!
With no upfront fees, you can expect quality advisors at an unbeatable price. With the deadline fast approaching, don’t wait too long to claim your tax credits.
