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GET PAID FOR PAYING YOUR EMPLOYEES DURING THE COVID-19 CRISIS

The employee retention credit (ERC) introduced in the CARES Act has been one of the most significant sources of relief for employers struggling to recoup COVID-19 losses. The benefit was made even better by the passing of the Consolidated Appropriations Act, which extended the credit into 2021 and expanded eligibility to include qualified Paycheck Protection Program (PPP) borrowers.

Grassi’s tax advisors provide the guidance and certainty business owners need to determine their eligibility, calculate qualified wages and maximize this refundable payroll tax credit under both pieces of legislation.

Services include:

2020 ERC under the CARES Act (applicable to qualified wages paid after March 12, 2020 and before January 1, 2021)

  • Analyze eligibility based on full or partial shutdown due to government order or more than 50% decline in gross receipts requirements.
  • Determine number of full-time equivalent (FTE) employees for purposes of ERC calculations. (Under the CARES Act, employers with 100 or fewer FTE employees can base the credit on all employees, whether they worked or not.)
  • Maximize credit up to 50% of $10,000 of qualifying wages per employee paid during covered period, for a maximum of $5,000 per employee.
  • Assist PPP borrowers in identifying qualified 2020 wages that were not paid for with forgiven loan funds.

2021 ERC under the Consolidated Appropriations Act and the American Rescue Plan Act (expanded credit for wages paid between January 1, 2021 and December 31, 2021, which was subsequently changed by the Infrastructure Investment and Jobs Act to end on September 30, 2021 for all employers except recovery startup businesses.)

  • Analyze eligibility based on full or partial shutdown due to government order or more than 20% decline in gross receipts requirements.
  • Determine number of FTE employees for purposes of ERC calculations. (Under the new law, employers with 500 or fewer FTE employees can base credit on all employees, whether they worked or not.)
  • Maximize credit up to 70% of $10,000 of qualifying wages per employee per eligible quarter.
  • Assist PPP borrowers in identifying qualified 2021 wages that were not paid for with forgiven loan funds.

Unlike year-end tax credits, the ERC can be taken immediately and bring timely financial relief to your business when it needs it the most. Contact your Grassi tax advisor today to get started, or call our Crisis Response & Recovery Hotline at 212.223.6216.