The Employee Retention Credit (ERC) is a refundable payroll tax credit for small businesses in which they can receive up to $26,000 per employee. This relief legislation was passed by Congress through the CARES Act to help businesses impacted by COVID-19

• The 2020 ERC Program is a refundable tax credit of 50% of up to $10,000 in wages paid per employee from the period of 3/12/20-12/31/20 by an eligible employer. This averages out to $5,000 per employee.
• The 2021 ERC Program increased to 70% of up to $10,000 in wages paid per employee per quarter for the first 3 quarters of 2021. This can be up to $7,000 per quarter or about $21,000 per employee.

No, the ERC is not a loan, it is a refundable tax credit in which you will receive a refund check.

Yes. You can still qualify for an ERC refund check, even if you received PPP. The CARES Act did originally prohibit having both the ERC and a PPP loan, however the stimulus legislation that has recently passed now allows your business to take advantage of both the PPP and ERC refund.

Yes. The ERC does apply to Nonprofits as well. Organizations such as hospitals, schools, museums, performing arts centers, and churches can qualify for the ERC.

If your business had to change operations due to governmental orders or if gross receipts declined by 20%, your business would likely qualify for the ERC Tax credit.

A change in operations could mean

• Additional cleaning or sanitizing,
• Limiting capacity,
• Reducing hours,
• Installing or utilizing protective equipment,
• Temperature checks,
• Operational impact related to key suppliers or customers,
• Unable to attend trade shows in-person,
• Had staff go from in-office to work-from-home and impacted your business,
• Closed a particular department even though other departments were still in operation.

These are just a few examples, and as part of your process we will assist you in identifying and documenting these items.

If you needed a brain operation, would you go to a general surgeon? In truth a general surgeon could perform the operation, but with such a delicate operation, if given the option wouldn’t you want a neurosurgeon with the experience to safely navigate your procedure and get the best possible results?

The same holds true for your accountant, your CPA most likely specializes in Federal and State tax preparation and can handle your annual returns with ease…however ERC credits utilize the claimed employment taxes on form 941, which is typically handled by your company’s payroll service. Filing for the ERC is a detailed and complex process, which requires the know-how to help navigate the process with ease.

Your CPA will need to learn the intricate ins-and-outs of filing for your ERC correctly, which includes providing a 15 page letter of opinion as well as a 50 page ERC assessment documentation. This could take months or even years in some instances.

If your CPA is filing your business taxes for this period, especially with the current state of overworked, understaffed accounting firms, asking them to take on the task of learning “neuroscience”, and doubling or tripling their workload could not only delay both your returns and your ERC filing, but also put a strain on your relationship, which won’t be positive for either party.

ClearERC was solely created to help businesses get the maximum ERC that they are entitled to. We pride ourselves on employing a level of professionalism and efficiency, partnering with the top CPAs and Tax Attorneys specializing in this particular field, in order to get you your return as quickly as possible.