There’s Still Time to File: How to Get Help with Your ERTC 2022 Today

In just a few weeks, one of the busiest tax seasons on record will come to an end and business owners are scrambling to put together the proper documentation in order to qualify for as many tax breaks as possible. One such incentive, the Employee Retention Tax Credit, aims to provide companies a kickstart to the year while rewarding them for keeping employees on board throughout the Coronavirus crisis.

First approved by Congress in March 2020 as a part of the CARES Act, the payroll tax credit gives employers a hefty refundable option to claim 50% to 70% of qualifying wages for each employee who meets the list of criteria.

If you own a company and have 500 or more full-time employees, the information below can help you understand your options and how to get help with your ERTC 2022 today.

How Do You Qualify for the ERTC 2022?

Qualification for the Employee Retention Tax Credit for 2022 depends on several different factors such as the amount of employees working full-time in your business, gross receipts for various sales quarters, previous credits received, as well as a series of other conditions.

Determining whether or not your business can claim the ERTC 2022 can have a serious impact on the financial health of the company and the ability to retain employees in future years.  Meeting some of the following criteria can help you decide if you should file the credit for your business:

  • 500 or less full-time employees
  • Designated as either a recovery business or another qualifying business
  • Suffered a substantial loss of revenue as a byproduct of the pandemic or or was affected by a government mandate related to COVID

If you have questions regarding how to qualify for the ERTC for the current tax season, then an assessment from one of our highly trained tax experts can get you headed in the right direction.

 

When Was the Employee Retention Tax Credit Passed?

The Employee Retention Tax Credit was first passed into legislation during the first couple of months of 2020 as a part of the pandemic sweeping through the nation. The law set aside over $1.9 trillion dollars to help thousands of business owners who were struggling to keep employees around to their companies afloat.

Originally, the CARES Act only permitted those who met stricter qualifications to apply for the funding, however that was expanded due to the Infrastructure Investments and Jobs Act and American Rescue Plan Act.

Due to this, those small business owners who suffered from financial setbacks due to a lack of manufacturing, employee loss or reduced hours in conjunction with a nationwide shutdown, were able to rebound and potentially keep their businesses from going insolvent.

Cash Flow Reserves Analysis Survey at Onset of Pandemic in 2020 via PNAS
Image Credit: Cash Flow Reserves Analysis Survey at Onset of Pandemic in 2020 via PNAS

Can You Get the ERTC 2022 and a Paycheck Protection Program Loan?

Initially, the rules regarding the Employee Retention Credit excluded those companies who had recently gotten approved for loans inside of the Paycheck Protection Program. However, after careful consideration and evaluation of the enormity of setbacks occurring due to the inability to be considered, Congress revamped the requirements.

For those of you filing for an ERTC in the current tax season, having a EIDL or PPP loan does not disqualify you from being eligible for claiming the full amount of the credit. It is important to keep in mind that you will still have to take additional actions in order to remain tax compliant through the process to avoid unnecessary penalties and/or mistakes with filing.

The following requirements must be met for a successful claim if your company wishes to file after having received a PPP loan.

  • Wages claimed for the ERTC must not be counted as those included for PPP forgiveness
  • Eligible wage amounts cannot be used for both programs at once

At ERTCFiling.com we have what it takes to get you qualified for an ERTC regardless of your tax situation. As long as you meet the requirements, our specialists will work diligently to ensure that your documents are completed successfully with a high approval rating.

Can You Still Claim Employee Retention Credit for 2020?

The Employee Retention Credit can be retroactively claimed for the past three tax seasons. To be considered your business must be distressed by having experienced a major decline in gross receipts when comparing business quarters over any two years beginning in 2019. Guidelines also state that employers can qualify for up to 50% of qualifying wages up to $10,000 in 2020, and up to 70% of qualifying wages up to $10,000 in 2021.

Is the ERTC Available for Q4 2021?

Unfortunately, due to changes in the IIJA, the only businesses that qualify to file for the ERTC in Q4 2021 are business classified as “recovery startup businesses”. These are businesses that started operations after February 15th, 2020 and that had less than a million dollars in annual gross receipts.  These businesses would be able to receive a maximum of $50,000 Q4 ERTC.

Conclusion

There have been many changes since the Employee Retention Tax Credit was implemented. Navigating the complexities of the IIJA, CARES Act, ARPA and TCDTRA can be difficult if you aren’t well versed in tax laws and procedures. If your business is in need of help with filing for the ERTC 2022 and unsure of how to avoid having to file an amended return down the line, then speak with one of our highly specialized tax professionals at ERTCFiling.com today.