First, businesses that received PPP loans were not eligible for the ERC, which may be why the program received little attention. The Taxpayer Certainty and Disaster Tax Relief Act changed the rules and again expanded eligibility to include businesses that received PPP loans. Unfortunately, many business owners and accountants may not be aware of this change.
How much a business can ask for has changed over time and depends on the salary allowed and the number of employees. For full details and more information about ERC eligibility and how to calculate your potential credit, visit IRS website.
Ask your credit
If your business has slowed down during the pandemic, ERC can provide the funds you need to get back up to full speed. Businesses that employ even one or two people in 2020 or 2021 could earn thousands of dollars in this tax credit.
It is wise to consult a tax professional before claiming the ERC, especially since your claim must be filed after the 2021 deadline. Eligible businesses that filed their taxes for 2020 or 2021 may need to file amended returns.
For more information about the ERC, go to IRS website.
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