Has your business kept people employed throughout the pandemic? You may be eligible for millions in IRS returns through the Employee Retention Credit (ERC) program.
Like with many other business tax issues, many business owners are confused about whether or not they qualify for the credit and how to apply. If this is you, don’t worry – LG Resources is here to help. Below, we answer some of the most common questions we are asked about this program.
It’s still not too late to receive this amazing employer tax credit!
FAQs About the Employee Retention Credit
Do essential businesses ever qualify for the employee retention credit?
Yes, an essential business can sometimes qualify for the ERC! If gross receipts declined by 20% year-over-year, or if operations are fully or partially suspended because of a government order, your business qualifies.
Do businesses that took PPP loans qualify?
Yes, they can! The stimulus package passed in December 2020 made it so that companies that received PPP funds could also take the ERC.
What if my business stayed open the whole time during COVID?
If your company had to perform extra cleaning or sanitizing, install or utilize extra protective equipment, do temperature checks, or change job roles and functions as a result of COVID, you may qualify for the ERC.
This credit is open to businesses that had to change operations in any way due to governmental orders, as well as businesses whose gross receipts declined by 20% year-over-year.
What if my business didn’t see a decline in sales?
Businesses that experienced a 20% decline in gross receipts OR a suspension in operations can qualify – both are not necessary. Almost every business has been impacted in some way by a national, state, or local governmental order, meaning they can qualify.
What if my business was profitable throughout the pandemic?
LG Resources’ ERC experts have helped many companies that were profitable in 2020 and 2021 receive anywhere from thousands to millions of dollars in credits. These include grocers, manufacturing, logistics companies, and more.
If your business has been impacted in some way by the pandemic, you likely qualify.
Can nonprofits that don’t pay taxes qualify for the employee retention credit?
Yes, they can. The ERC applies to tax-exempt organizations if operations were fully or partially suspended due to governmental orders related to COVID. Many nonprofit daycares, schools, daycares, counseling centers, ministries, churches, and clubs closed their buildings, and some partially suspended their services to comply with government orders and guidelines.
If you had to suspend any operations, your organization likely qualifies for the ERC. Check out our recent video about how our ERC experts helped a nonprofit in South Carolina get $125,000 of credit.
What if my employees weren’t paid hourly wages or a salary?
For the purposes of the ERC, group health insurance may count as qualifying wages. Don’t give up – reach out to us today to find out if your business still qualifies.
Is it difficult to get the employee retention credit?
Qualifying for the ERC is easy when you get professional support from an ERC specialist. Contact us today to find out whether you qualify and start the process.