About The ERC Program 

What is the Employee Retention Credit (ERC)? 

ERC is a stimulus program designed to help those businesses that were able to retain their employees during the Covid-19 pandemic. 

Established by the CARES Act, it is a refundable tax credit - a grant, not a loan - that you can claim for your business. The ERC is available to both small and mid-sized businesses. It is based on qualified wages and healthcare paid to employees.

• Up to $26,000 per employee 

• Available for 2020 and 3 quarters of 2021 

• Qualify with decreased revenue or COVID event 

• No limit on funding 

• ERC is a refundable tax credit

How much money can you get back? 

You can claim up to $5,000 per employee for 2020. For 2021, the credit can be up to $7,000 per employee per quarter.

How do you know if your business is eligible? 

To qualify, your business must have been negatively impacted in either of the following ways: 

• A government authority required partial or full shutdown of your business during 2020 or 2021. This includes your operations being limited by commerce, inability to travel or restrictions of group meetings.
• Gross receipt reduction criteria is different for 2020 and 2021, but is measured against the current quarter as compared to 2019 pre-COVID amounts.
• A business can be eligible for one quarter and not another. 
• Initially, under the CARES Act of 2020, businesses were not able to qualify for the ERC if they had already received a Paycheck Protection Program (PPP) loan. With new legislation in 2021, employers are now eligible for both programs. 

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FAQ: 

Do we still qualify if we remained open during the pandemic? 

Yes. To qualify, your business must meet either one of the following criteria: 

- Experienced a decline in gross receipts by 20%, or 
- Had to change business operations due to government orders 

Many items are considered as changes in business operations, including shifts in job roles and the purchase of extra protective equipment. The ERC, in this case, also applies only for Q3 and Q4 of 2021. Businesses can qualify, regardless of the number of full-time employees. 

The Employee Retention Credit 

The ERC underwent several changes and has many technical details, including how to determine qualified wages, which employees are eligible, and more. Your business’ specific case might require more intensive review and analysis. The program is complex and might leave you with many unanswered questions. 

We at GovernmentAid can help make sense of it all. Our dedicated experts will guide you and outline the steps you need to take so you can maximize the claim for your business.