The Employee Retention Credit (ERC) was created as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act to help employers impacted by the COVID-19 pandemic. The credit was designed to provide financial relief to businesses that were forced to close or had a significant decline in revenue due to the pandemic. Unfortunately, many employers eligible for the credit did not claim it. The good news is that these employers can now claim retroactive ERC claims for 2020 and 2021.
Understanding the ERC
The ERC is a refundable tax credit that allows eligible employers to claim up to $5,000 per employee for 2020 and up to $28,000 per employee for 2021. The credit is available to businesses that meet certain criteria, such as having a significant decline in revenue or being forced to close due to government orders. The credit is calculated based on employee wages, with a maximum credit of 70% of qualified wages.
Retroactive Claims for 2020
Many employers eligible for the ERC in 2020 still need to claim the credit. This was because the credit was not well-publicized, and many employers did not know they were eligible. However, the IRS has announced that eligible employers can now claim retroactive ERC claims for 2020. This means that businesses can claim the credit on their 2020 tax returns and receive a refund for the credit amount.
Retroactive Claims for 2021
The ERC was extended through 2021 as part of the Consolidated Appropriations Act 2021. This means that eligible employers can also claim retroactive ERC claims for 2021. The credit amount has also increased, with eligible employers now able to claim up to $28,000 per employee for 2021.
How to Claim Retroactive ERC Claims
Eligible employers must file amended payroll tax returns for the applicable quarters to claim retroactive ERC claims. This can be a complicated process, as it requires a thorough review of payroll records and calculation of the credit amount. To ensure that you are claiming the correct amount and following all applicable regulations, it is recommended that you work with an experienced tax professional.
GetMyBizRefund: Your Partner for ERC Claims
At GetMyBizRefund, we specialize in helping businesses claim retroactive ERC claims for 2020 and 2021. Our experienced tax professionals can review your payroll records, calculate the credit amount, and file amended tax returns on your behalf. We have a proven track record of success, having helped numerous businesses claim millions of dollars in retroactive ERC claims.
Claiming Retroactive ERC Claims
The ERC is a valuable tax credit that can provide significant financial relief to businesses impacted by the COVID-19 pandemic. If you were eligible for the credit in 2020 or 2021 but still need to claim it, now is the time. Contact GetMyBizRefund today to learn how we can help you claim retroactive ERC claims and receive the financial relief you deserve.