You may be eligible for the Employee Retention Tax Credit (ERTC) if you’re a business owner. This credit was introduced as part of the Coronavirus Aid, Relief, and Economic Security Act.

The ERTC is a refundable tax credit that provides up to $26,000 per employee to eligible employers.

This credit can offset federal payroll taxes and help businesses keep their employees on the payroll. Check out how to apply.

To qualify for the ERTC, you must have experienced a significant decline in revenue due to the COVID-19 pandemic.

This decline can be measured by comparing your quarterly gross receipts from 2021 to the same quarter in 2019.

If your gross receipts are less than 80% of what they were in 2019, you may be eligible for the ERTC.

In addition to the revenue decline, you must meet one of two other criteria. You can find more detailed information about these requirements on the IRS website.

To apply for the ERTC, you will need to gather several documents. These may include quarterly tax returns, proof of payroll expenses, and evidence of the decline in gross receipts.

You should also keep detailed records of your business operations during the pandemic, including any changes you made to your business model, such as pivoting to e-commerce or offering new products.

Applying for the ERTC can be a complicated process, but it can be a straightforward and stress-free experience with the right guidance. Here’s a step-by-step guide to help you apply for the ERTC:

As mentioned above, you must gather several documents to apply for the ERTC. Make sure you have everything you need before you start the application process.

Use the IRS guidelines to determine if you’re eligible for the ERTC. If you’re unsure, you can consult a tax professional or accountant.

Use the IRS worksheet to calculate the amount of the credit you’re eligible for.

You can apply for the ERTC on Form 941, the quarterly tax return form that all employers must file. Make sure you fill out the form accurately and include all required information.

Once you’ve completed the application, you can submit it to the IRS. You can do this electronically through the IRS website or by mailing the form to the appropriate address.

If your application is approved, you will receive the ERTC as a credit against your federal payroll taxes.

This credit can help you keep your employees on the payroll and support your business during these challenging times.

Are you familiar with other programs that offer tax credits and incentives? One such program is the Earned Income Tax Credit (EITC).

This program provides a tax break for low to moderate-income workers and families!

If you want to learn more about EITC and see if you can qualify to apply, read our post below!