Employee Retention Credit: Does Your Business Qualify
2021 – 03/30 Did your business retain employees during the COVID-19 pandemic? If yes, you could enjoy tax relief with the Employee Retention Credit (ERC).
Originally introduced with the CARES Act, the ERC is a refundable tax credit against certain employment taxes equal to 50% of qualified wages, up to $10,000 per employee, that an eligible employer paid to employees after March 12, 2020, and before January 1, 2021.
The Consolidated Appropriations Act extended ERC through June 30, 2021 and expanded the credit to 70% of qualified wages, up to $10,000 per employee per calendar quarter.
The American Rescue Plan Act extends the ERC from June 30 until December 31, 2021. The law continues the credit of 70% for this extended time period. It also continues to allow for up to $10,000 in qualified wages for any calendar quarter. This means an employer could potentially have up to $40,000 in qualified wages, equaling a $33,000 maximum tax credit per employee through 2021.
We can help you determine whether your business qualifies for the ERC and, if so, how much the credit may reduce your tax bill.
Contact your Bland Garvey accountant for further information. Not a client, contact Deborah Carroll @ email@example.com