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Nearly all industries were affected by the COVID-19 pandemic. Shutdowns, capacity limitations, remote work, and many other factors made it difficult, if not impossible, to comfortably maintain a business. Childcare centers and behavioral centers were no exception to these restrictions. In fact, together, the childcare and behavioral center industry lost billions of dollars in revenue during the pandemic. Fortunately for these businesses, the Employee Retention Credit (ERC) is still available to be claimed. ERC is part of the 2020 CARES Act, and it can provide a cash benefit per employee for already paid wages.
If you own or manage a childcare center or behavioral center and wonder about your business’s ERC eligibility, get in touch with Strategic Tax Planning. You can get a free consultation with a Certified Public Accountant (CPA) by calling (202) 455-6010 or by filling out this contact form, and we will reach out to you.
To be eligible for Employee Retention Credit, a childcare or behavioral center typically must have W-2 employees, and fall into at least one of the two following categories:
- Your business(es) experienced decreased revenue during quarters 1-4 in 2020 and 1-3 in 2021, compared to 2019
- Your business(es) suffered from any number of government-mandated restrictions
Government-mandated restrictions have the potential to include a wide range of things. Examples may include reduced operating hours, capacity limitations, mandated virtual or hybrid work, or required sanitation procedures, among others.
Moreover, business owners may be wondering how their childcare or behavioral center’s ERC eligibility is affected if they received the Paycheck Protection Program (PPP) loans in 2020 or 2021. Regardless of whether your business received PPP 1 and/or 2, you may be eligible for ERC. Speaking with an experienced CPA can help you to understand your eligibility.
If you have already submitted a claim for the Employee Retention Credit for your business, you may be wondering how long you should expect to wait until receiving the tax credit. Ultimately, each case is unique and is going to have a different timeline. Due to so many businesses being affected by the pandemic, the IRS is dealing with a high volume of applications. Your ERC refund may be processed in about 8 months, although there is potential for it to take longer.
If you wish to see the status of your refund, you may call the IRS, or use the “Where’s My Refund?” feature on the IRS website.
Claiming the Employee Retention Credit can be a needed relief for many private equity portfolio companies, but it is important to make sure you and your tax planners are thorough and diligent when examining your eligibility. It is crucial to note that the IRS will carefully examine your claim for this credit. Submitting an ERC claim with untrue information can lead to compliance risks such as ERC audits in the future, setting up a potential disaster.
Strategic Tax Planning’s experienced CPAs and tax professionals will work closely with you and your business, ensuring all ERC qualifications and facts are accurate and in order. We are here to help you receive your deserved relief for persevering during difficult financial times.
More Industries that Benefit from the Employee Retention Credit
Discover the potential for your business to thrive as one of the many that have claimed the ERC.
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How We Help Businesses Receive the ERC
Identify Eligibility
We analyze your business to determine if you qualify for the Employee Retention Credit.
Compile Documentation
We will help your gather the essential documentation as comprehensive support for your ERC claim.
Optimize Strategy
Our team will develop a tax planning strategy that optimizes benefits for your unique situation.
Ensure Compliance
We will mitigate your risk by ensuring you stay compliant with regulatory guidelines.
Meet our Tax Professionals
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