ENHANCED EMPLOYER RETENTION TAX CREDITS NOW AVAILABLE

ENHANCED EMPLOYER RETENTION TAX CREDITS NOW AVAILABLE

If your business was either fully or partially shut down due to a governmental order or  your business has experienced a significant decrease in revenue, you may be eligible to apply for the newly enhanced employer retention tax credit.

The recently enacted Consolidated Appropriations Act of 2021 (CCA) put into law a few highly publicized  programs including a second round of Stimulus payments and Paycheck Protection Program loans. A lesser known provision in the Act also enhanced and expanded the Employer Retention Credit (ERC) which will provide a substantial benefit to many businesses.

Changes Under the New Stimulus Plan

Under CCA, the Employer Retention Credit now does the following for 2021:

·         Increased the limit of creditable wages from $10,000 per year to $10,000 per quarter for the 1st & 2nd quarters of 2021

·         Increased the credit rate from 50% of qualified wages to 70% 

·         Reduced the required decrease in gross receipts from 50%  to 20%

·         Expanded the program to businesses with 500 or fewer employees

·         Allows employers who also applied for Paycheck Protection Programs to now apply for the ERC for both 2020 & 2021.

If you believe your business may be eligible for this enhanced employer retention credit, please reach out to our office for further information