You had a loss of income as a result of Covid-19
Your business suffered under the Nominal Impact Test
Call us now for your free evaluation, EVEN IF your CPA told you that you don’t qualify, and/or you received PPP assistance.
ALL YOU NEED TO KNOW ABOUT THE EMPLOYEE RETENTION TAX CREDIT
In the CARES Act of 2020, Congress developed the ERTC program to reward and help businesses who either suffered a loss of income due to Covid-19, or their business was impacted as a result of Governmental mandates, conditions caused by Covid-19, and other incidental impacts. Your business can receive up to $26,000/W-2 employee, which you never have to pay back.
We have a team of highly qualified accountants, tax lawyers, and dedicated professionals standing by to give you a free evaluation, and help you qualify for the ERTC program.
There is no fee unless you receive ERTC funds.
TWO WAYS TO QUALIFY FOR THE ERTC
1. Loss of Revenue
The ERTC is a federal stimulus program made for companies that remained open during the pandemic and retained W2 employees. Your company may qualify for the ERTC by showing either:
A full or partial suspension of operation during any calendar quarter because of governmental orders limiting commerce, travel or group meetings due to COVID-19.
In Q4 of 2020, you experienced a decline in gross receipts of 50% from the corresponding quarter in 2019 or less than 80% of gross receipts in the preceding quarter.
All 3 quarters in 2021 are eligible to use the 80% gross receipts test versus the preceding quarter or the corresponding quarter from previous year instead to 50% drop in gross receipts, refund up to 70% of $10,000 per employee.
2. Nominal Impact Test
Yes. Reduction in revenue is only one mechanism of qualification, however there are other nominal impacts that can still lead to qualification.
For example, if your business maintains both essential and non-essential business operations, each of which are more than nominal portions of your business operations, your company may be considered to still have a partial suspension of its operations if a governmental order restricts the operations of the non-essential portion of the business, even if the essential portion of the business is unaffected.
HOW MUCH IS THE ERTC WORTH TO MY BUSINESS?
The ERTC can be worth up to $26,000 per W2 employee in your business. ERTC funds are NOT a loan and do not have to be repaid. There are no stipulations on how a business may use ERTC funds once received. Though labeled a “tax credit” the ERTC is distributed to the business as a direct payment from the IRS.
- Yes. While a reduction in revenue is one mechanism of qualifying for the ERTC, it is not the only mechanism. The Nominal Impact Test may also be used, and this test incorporates more qualitative factors such as supply chain disruption related to government mandates.
- Yes. Receipt of PPP loans does not disqualify a business from receiving the ERTC. However, all PPP funds that a business did receive, and applied to payroll expenses, must be properly accounted for prior to calculating the ERTC. This step is handled by tax attorneys as part of their detailed analysis of your business.
- When a CPA deems a business to “not qualify” for the ERTC, it is almost always due to the CPA’s analysis of the Revenue Reduction Test. CPAs, broadly speaking, have been less than enthusiastic to analyze businesses under the Nominal Impact Test and have left such analysis to tax attorneys specializing in the ERTC.
- No. The ERTC is intended for businesses that operated during the pandemic and maintained W2 employees. Only businesses that are directly related to federal or state government are ineligible. Private businesses from most industries, including non-profits, may qualify.
- There are no minimum number of employees required to access the ERTC. However, the maximum number of employees a business may possess is 100 in 2020 and 500 in 2021.
- The ERTC has evolved significantly since its inception and this evolution has resulted in confusion and misunderstanding of the program. Without following the details contained in hundreds of pages of the CARES Act, along with subsequent executive orders by both President Trump and President Biden, the opportunity in the ERTC can be easily missed.
- All of our work is performed on a contingency fee basis and you pay nothing until you receive your ERTC checks from the IRS. In addition, in the unlikely event of a subsequent IRS audit challenging our legal determination of your eligibility, our tax attorneys will provide a full defense of your ERTC claim at no additional fee.