As a common place for people to gather, restaurants and bars faced many restrictions due to the variety of government orders during the pandemic. Because of this, there are just as many ways to qualify for the Employee Retention Credit. That is why it is important to speak with tax professionals and CPAs to understand your eligibility. 

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If your restaurant or bar experienced any of the following, you may be eligible for ERC:

• Full or partial shutdown
• Interrupted operations
• Supply chain interruptions
• Limited capacity to operate
• Capacity limitations
• Difficulty working with vendors
• Reduced services or goods offered to guests
• Decrease in hours of operation
• Shifting hours to increase sanitation of the facility
• Decrease in sales

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While your restaurant or bar may have already received other aid in the past, such as Paycheck Protection Program (PPP) loans or RRF (Restaurant Revitalization Fund) grants, these do not disqualify you from obtaining relief from ERC. Your business can still claim this uncapped tax credit if you qualify.

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With all the government mandates restricting operations and interrupting supply chains, many restaurants and bars made less money in 2020 and 2021 than usual. However, it may still be possible that your business experienced an increase in revenue during this time. 

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Fortunately, restaurants and bars that received an increase in revenue may still be eligible for ERC if the business was affected by a number of government-mandated restrictions. Speaking with a Certified Public Accountant will help you understand if this kind of qualification applies to you.

Business owners who have previously submitted their claims for the Employee Retention Credit are likely curious about the anticipated timeline for receiving the tax credit. Given the significant impact of the pandemic on numerous businesses, the IRS faces a substantial workload in processing these applications.

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The timeline for each case varies. While it is possible to get your refund processed within 8 months, it could potentially take longer. 

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If you wish to check 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 relief for restaurants and bars as it provides a tax credit to help cover wages paid during the pandemic. However, it is important to note that claiming this credit requires careful attention to the eligibility requirements and accurate reporting. The IRS scrutinizes eligibility claims to ensure they are legitimate, and submitting an erroneous claim can lead to audits and other issues.

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To avoid these problems and ensure that your business receives the relief you deserve, it is essential to seek professional assistance. Strategic Tax Planning has experienced CPAs who will work closely with you to ensure that all qualifications are met and all facts are accurate. This can help businesses navigate the complex rules surrounding the ERC and avoid costly mistakes.