Please take a look at the answers to our frequently asked questions on ERTCs at a glance.
I thought the ERTC tax credit was only available in 2020?
The American Rescue Plan extended the ERTC to the end of 2021 (now ending September 30, 2021, with the passing of the Infrastructure Investment and Jobs Act). For 2021, eligible employers can get a credit equal to 70 percent of qualifying wages per quarter. The maximum credit per quarter is $7,000 per employee.
Can I receive ERTC funds for Q4 2021?
No……but hope is not lost. There is a movement by politicians to include Q4 2021 but currently, wages paid after September 30, 2021, are no longer considered eligible wages for ERTC purposes.
How much will I get from claiming the ERTC tax incentive?
Your company may be eligible for up to $26,000 per employee.
If you are making an ERTC claim for the year 2020, you can receive 50% of the qualified wages of your full-time workers quarterly. Total wages considered are capped in 2020 at $10,000 per employee. Therefore, the highest credit you will receive per employee is $5,000.
For the year 2021, you can receive 70% of the qualified wages of your full-time workers quarterly for Quarter 1, Quarter 2, and Quarter 3. Total wages considered are capped in 2021 at $10,000 per employee per quarter. The maximum possible credit you can receive for each employee is $7,000 per quarter, amounting to $21,000 per employee for the year’s first three quarters.
What is employee retention tax credit qualified wages?
According to the ERTC, qualified wages are the wages, and compensation employers pay to their employees during the specified time frame. Therefore, to be eligible for an employee retention tax claim, your employees should have received qualified wages throughout the calendar year. If your company provided employee health insurance, that is included with the qualified wages.
How long will it take for me to receive my employee retention tax credit?
That depends on the IRS backlog, and at present, the minimum expected wait time to receive your ERTC credit disbursement from the IRS is 9 months. Please note that due to the complexity of our processes and the critical nature to ensure absolute accuracy it will take approximately 3-6 weeks to complete your ERTC filing.
Do I have to pay back the employee retention credit I receive?
No. The employee retention tax credit is not a loan. Therefore, you do not have to pay it back.
Am I still eligible for the ERTC if I applied for an additional tax credit or received a loan?
Yes, you will be eligible. As of December 2020, the Consolidated Appropriations Act (CAA) made a provision that allows businesses that took out PPP loans to qualify. However, your number of qualified wages depends on your PPP loan forgiveness application.
How will my ERTC be calculated if I provide my employees with health insurance?
If you provided your employee with $10,000 for the first quarter of 2021 in addition to $500 for health insurance. In that scenario, your ERTC will be 70% of the sum of the qualified wages and health insurance. Therefore, the total amount would be $7,350.