Frequently Asked Questions

We frequently help business owners claim the Employee Retention Credit for their business. Learn more about this tax credit opportunity by reading these frequently asked questions.

What is the ERC (Employee Retention Credit)?

The ERC is a refundable payroll tax credit. It was introduced in 2020 as part of the CARES Act to help businesses recover from the COVID-19 pandemic.

How do you apply and file for ERC?

To apply for the ERC, file Form 941 for each qualifying quarter. There are many factors that go into accurately calculating your refund, so consider consulting a professional to document the information.

Can I get both the ERC credit and a PPP loan?

Yes, as of 2021 you can claim the ERC even if you already received a PPP loan. However, you cannot use the same wages for both the PPP and ERC.

Does my business qualify for ERC?

If your business experienced operation disruptions during the COVID-19 pandemic, you may qualify for the Employee Retention Credit. This can include full or partial shutdowns, supply chain disruptions, reduced hours, reduction in goods or services offered, and other complications. Even if your business was profitable, deemed essential, or did not experience a full shutdown, you may still be eligible for the Employee Retention Credit (ERC). Speaking with a tax professional can help you to get a better understanding of your business’s eligibility.

Which industries qualify for the ERC?

Businesses across a variety of industries can qualify for the Employee Retention Credit. Strategic Tax Planning has helped individuals with many kinds of businesses. To learn more about the industries and business that we have helped, visit our Industries page.

Do I have to pay back the ERC?

No, the Employee Retention Credit is not a loan. It is a fully refundable tax credit and does not need to be paid back.

How is the refund calculated?

The Employee Retention Credit (ERC) is calculated based on the wages an employer has paid to their eligible full-time employees in 2020 or certain quarters of 2021.

How long does the ERC process take after you submit your application?

The IRS is dealing with a high volume of Employee Retention Credit (ERC) filings, making it difficult to give an estimation for the timeline of the ERC refund process. In some cases, it may take more than 8 months to receive the refund. You may call the IRS directly to inquire about the status of your return.

What can my business use the ERC refund for?

The Employee Retention Credit (ERC) refund can be used for anything. Businesses may choose to pay off debts, retain current or hire new employees, or grow their business in other ways. There are no limitations or rules for how to use the refund.

Why should I work with the tax professionals at Strategic Tax Planning for my ERC claim?

The IRS will examine each Employee Retention Credit (ERC) claim for eligibility, making it vital to be accurate in your filing. Working with a tax professional can help you and your business organize the facts of your claim to give you confidence and assurance in the event of an audit. Strategic Tax Planning will conduct extensive research to ensure your eligibility is supported by current legislation and your business's documentation.

I’ve been told my business does not qualify. Can I get a second opinion?

Yes! If you have previously worked with a tax professional who advised you against claiming the Employee Retention Credit (ERC), you may get a second opinion on your eligibility. Similarly, if you have already claimed ERC, you may get a second review to make sure you’re in good standing.

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