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Employee Retention Credit (ERC)

Employee Retention Credit
We specialize in maximizing ERC funding for small businesses.

Helping your business get up to $26K per employee on tax refunds.

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What is the Employee Retention Credit?

The Employee Retention Credit (ERC) – sometimes called the Employee Retention Tax Credit or ERTC – is a refundable tax credit for businesses and tax-exempt organizations.

The requirements are different depending on the time period for which you claim the credit. The ERC is not available to individuals.

Understanding the ERC

The Employee Retention Credit or ERC is a generous stimulus program designed to bolster businesses that were able to retain their employees during the Covid-19 Pandemic by giving them a refundable tax credit check. Some of the benefits from this program include:
  • Up to $26,000 per employee
  • No limit on funding (ERC is not a loan)
  • Flexible use of funds
  • Available for 2020 & Q1-Q3 2021

Covid-related Restrictions

Reduction in Revenue1

Supply Chain Disruptions

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FAQ

General Questions

No. This is not a loan. It's a refundable tax credit. When we file your ERC claim we request a refund check for you.
Our service charge is based on a percentage of the credit recovered. We calculate and provide our fee with our free analysis. Just like a good CPA, using the right team for this process pays for itself.
 
Of course. The challenge is the ERC credit is taken on your payroll returns and not through your business income tax returns, which is what most CPA's handle. Because of this most CPA's don't process this credit, unless they process your payroll in house. This is also a big reason why this credit is so underutilized. Since CPA's don't typically handle it and they are the tax experts, it has mostly fallen in a middle ground where few are able to effectively process the credit. Interestingly, we receive a large portion of our clients from CPA's.

At ERC Specialists we have decades of payroll experience, which has allowed us to specifically focus to understanding and maximizing the ERC program. In our experience we have found that due to the complexity (the ERC tax code is over 200 pages) and time investment necessary to understand the ERC program, very few are able to effectively maximize this sizeable credit for your business.

Yes. The Taxpayer Certainty and Disaster Tax Relief Act of 2020, enacted December 27, 2020, modified the ERC credit rules. One of the modifications included allowing a company to have a PPP loan and still take advantage of the ERC credit. However, you can't use the same dollar for dollar funds. We take this into account when processing your ERC credit.

Yes! There are two possible qualifications for 2020: revenue reduction, or a "full or partial shutdown of your business due to COVID-19". Specifically the IRS describes this as "A government authority required partial or full shutdown of your business during 2020 or 2021. This includes your operations being limited by commerce, inability to travel or restrictions of group meetings." Below are several examples of events indicating eligibility:

  1. A restaurant must close or limit its on-site dining. Such as having to close down every other table, due to COVID-19 restrictions.
  2. A business that needs to meet with clients in person and has to cancel meetings due to COVID-19 restrictions.
  3. A business has to reduce their operating hours because COVID-19 restrictions and cleaning requirements.
  4. A business had delayed production timelines caused by supply chain disruptions.
  5. A business with a planned event has to cancel that event, or restrict the amount of people who can attend due to COVID-19 restrictions.
Yes. We also offer a referral/affiliate program.
This is not a lending program - tax refunds are issued by the US Treasury. Therefore, all eligible employers will receive the funds.
We understand your refund check may not arrive for several months (20 weeks minimum according to IRS documentation). Regardless, our fee is covered by our 100% Money Back Guarantee. If the IRS does not release the credit claimed for any reason, we will refund any payments made.
Remember that this program is taken according to payroll taxes paid, not on income taxes. ERC funds not applied towards owed payroll taxes are treated as an 'overdeposit' of taxes that will be requested as a refund check from the IRS.
 
Maybe. Wages of owners who have majority ownership, defined as over 50%, are not eligible, nor are the W2 wages of any immediate family members of the owner. In the case an owner has less than 50% ownership, their W2 wages are eligible, as are the W2 wages paid to immediate family members.
 
No, if you are majority owner (over 50%) of your company then your wages are not eligible.
 
This is how the process works: you send us the required documents and we process an analysis at no charge. The process from start to finish usually happens in 2-3 weeks. If you wish to move forward, you will select your desired payment option and we file your claim. Once filed, refunds are released based on IRS backlog. Currently, the IRS has stipulated a 20 week minimum turnaround on the ERC refunds.
 
The ERC credit is not considered income for federal income tax purposes, but you must reduce any deductible wage expenses by the amount of the credit. Please provide the credit information to your CPA for tax purposes.
 

Yes, the ERC funds will need to be reported on your income tax return.

We have compiled a free resource of State and local government shutdown orders.
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