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tax money nesconset ny

Are You Missing Over $330,000 in Tax Credits?

The Employee Retention Credit could be worth more than $330,000 to a small-business client.

Polling shows that 75 percent of tax and accounting professionals have filed no (that’s zero) forms to claim the credit for clients. And now it’s ending early, due to a Congressional compromise on the big infrastructure bill.

An employer that is eligible for the employee retention credit (ERC) can claim the ERC even if the employer has received a Small Business Interruption Loan under the Paycheck Protection Program (PPP). The eligible employer can claim the ERC on any qualified wages that are not counted as payroll costs in obtaining PPP loan forgiveness. Any wages that could count toward eligibility for the ERC or PPP loan forgiveness can be applied to either of these two programs, but not both.

The laws regarding the ERC are still changing, and the Senate is planning to eliminate this credit for the fourth quarter of 2021 due to a lack of interest from eligible businesses and a bipartisan effort to find the money for the proposed infrastructure bill.  The good news is that if you are or were eligible, you can claim the credit retroactively for 2020 and the first three quarters of 2021. Links to the latest IRS guidance can be found at FAQs: Employee Retention Credit under the CARES Act | Internal Revenue Service

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