Employee Retention Credit
The Employee Retention Credit (ERC) is a refundable payroll tax credit that businesses can claim on qualified wages and health plan expenses, paid to retain full-time (30-hours per week) employees. This tax credit is a relief measure for the businesses that retained their employees on their payroll during the pandemic. Essentially, it is a reward for not laying off/furloughing your employees.
However, due to the complicated tax code and qualifications, the program is highly underutilized. Sales Tax Specialists of Texas can help your business with qualifying for this very beneficial tax program.
Below are listed the details of the ERC program:
- Claim up to $5,000 per employee for 2020 and up to $21,000 per employee in 2021.
- The tax can be claimed for periods from March 13, 2020, until September 30, 2021.
- Eligible employers are those whose business
- Was fully or partially suspended by government order due to COVID-19; or
- The employer’s gross receipts were below 50% for 2020 or 20% for 2021 – measured by quarter – compared to 2019.
- The ERC can be claimed retroactively.