employee retention credit in 2023

How to Apply for the Employee Retention Credit

 Applying for the Employee Retention Credit (ERC) involves more than just submitting documents to the IRS. It requires assessing eligibility, assembling accurate supporting documentation, and implementing quality controls for an accurate calculation. These requirements are crucial to avoid potential risks, such as IRS audits or delays in receiving the ERC. Working with experienced ERC providers is highly recommended to navigate these complexities and ensure compliance.

ERC Application Journey

We pride ourselves on being transparent and providing our clients with peace of mind. Unlike other providers, we believe in exposing the fine print upfront, allowing YOU to decide the level of risk you want to take on. We’re upfront about the liabilities, responsibilities, and risks involved with every ERC claim, so you can make informed decisions and have confidence in the process.

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Your ERC Journey Explained

Step 1 - Eligibility

Step 1 - Eligibility

Assessing one’s eligibility for the ERC requires a detailed understanding of the qualification criteria, which can be complex and constantly evolving. Assembling accurate supporting documentation involves the careful review of financial and payroll records, which can be time-consuming and require a high level of attention to detail. Furthermore, quality controls must be in place to ensure that an accurate calculation is produced, as the documents submitted to the IRS must be correct.

In general, businesses that have experienced a significant decline in revenue or have been subject to a full or partial suspension of operations due to a COVID-19-related government order may be eligible for the ERC. Additionally, eligible businesses must have retained their employees during the pandemic to be considered for this credit.

It’s important to note that the ERC is calculated at the quarterly level, and businesses must pass either the “Gross Receipts Test” or the “Government Mandate Test” on a quarterly basis to be eligible. Furthermore, the ERC credit amount varies from quarter to quarter, depending on factors such as qualified employee wages, healthcare premiums, and social security tax. 

Most businesses are qualifying through the “Government Mandate Test”. Learn more about it here.

Step 2 - Risk Assessment

Step 2 - Risk Assessment

Our claim assessment process will provide a thorough breakdown of the responsibilities that both you and the Employee Retention Tax Credit (ERC) processor are accountable for. By gaining a clear understanding of your individual responsibilities, you can make a confident decision on what protections to request.

It’s important to understand that when applying for the Employee Retention Credit, specific responsibilities vary depending on the unique nature of each claim. Our claim assessment will provide you with a detailed analysis of the responsibilities of all parties involved, to ensure that there is no ambiguity in the expectations.

By having a clear understanding of your responsibilities, you can make informed decisions that mitigate risk to your business.

Once you submit your application you’ll have the opportunity to decline aspects of your claim based on risk.

Click here to learn more about ERC Fraud and how we protect your business

Step 3 - Get Documentation

Step 3 - Get Documentation

We take pride in offering a personalized approach to ERC claim assistance. After completing the risk assessment and establishing claim protections, our next step is to help you assemble the required documentation necessary to process your claim.

It’s important to understand that the amount of documentation required will depend on the level of protections requested. Our team works closely with you to ensure that all necessary documents are provided and meet the ERC processor’s requirements. We want to ensure that your claim is processed accurately and efficiently.

The most commonly requested documents include payroll journals, W3 forms, quarterly 941s, and PPP loan forgiveness forms. These documents are critical in verifying employee wages and other expenses used to calculate your ERC credit.

Step 4 - Submit Application

Step 4 - Submit Application

Once you have collected all the necessary documentation, the final step is to complete the application portion of your claim. This application will provide your ERC processor with the remaining information about your business that will enable them to prepare your 941x forms. These forms are the key to claiming your funding from the IRS, so it’s essential that they are prepared accurately and promptly.

The way in which the final 941x forms are submitted to the IRS will depend on the protections you have selected. Your ERC processor will ensure that the forms are completed in accordance with your preferences, ensuring that your business is fully compliant with all applicable regulations.

By completing this application and submitting the relevant forms, you will be taking an essential step toward securing the funding that your business needs to thrive. So don’t delay – get started today and take control of your financial future!

Click here to learn more about application protections.

Learn About the Employee Retention Credit in 2023

What Is The Employee Retention Credit?

The Employee Retention Credit (ERC) is a refundable tax credit that provides financial relief to businesses that have been impacted by the COVID-19 pandemic. The credit is designed to encourage businesses to retain their employees and keep them on the payroll, even during difficult times. The ERC is available to businesses of most sizes, including non-profits.

Who Can Qulify For The Employee Retention Credit?

You must be considered a “Small Business” which is:

  • Any employer that operates a trade, business, or a tax-exempt organization.
  • That has fewer than 100 full-time employees (calculated from 2019) for the 2020 ERC refund.
  • And fewer than 500 full-time employees (calculated from 2019) for the 2021 ERC refund.

As a “Small Business” you may be eligible if you:

  • Experienced a significant decline in gross receipts during the 2021 calendar quarter, more than a 20% decline versus the same quarter of 2019, and a 50% decline in the 2020 calendar.
  • Pass “Government Mandate Test“.
How Much Will I Get From Claiming This Incentive?

Your company may be eligible for up to $26,000 per employee.

If you are making an ERTC claim for the year 2020, you can receive 50% of the qualified wages of your full-time workers quarterly. Total wages considered are capped in 2020 at $10,000 per employee.  Therefore, the highest credit you will receive per employee is $5,000.

For the year 2021, you can receive 70% of the qualified wages of your full-time workers quarterly for Quarter 1, Quarter 2, and Quarter 3.  Total wages considered are capped in 2021 at $10,000 per employee per quarter.  The maximum possible credit you can receive for each employee is $7,000 per quarter, amounting to $21,000 per employee for the year’s first three quarters.

What Is Employee Retention Tax Credit Qualified Wages?

According to ERC guidelines, qualified wages are the wages, and compensation employers pay to their employees during the specified time frame. Therefore, to be eligible for an employee retention tax claim, your employees should have received qualified wages throughout the calendar year. If your company provided employee health insurance, that is included with the qualified wages.

How Long Will It Take For Me To Receive My Employee Retention Tax Credit?

That depends on the IRS backlog, and at present, the minimum expected wait time to receive your ERTC credit disbursement from the IRS is 9 months. Please note that due to the complexity of our processes and the critical nature to ensure absolute accuracy it will take approximately 3-6 weeks to complete your ERTC filing.

Do I Have To Pay Back The Employee Retention Credit I Receive?

No. The employee retention tax credit is not a loan. Therefore, you do not have to pay it back.

Am I Still Eligible If I Claimed A PPP Loan?

Yes, you will be eligible. As of December 2020, the Consolidated Appropriations Act (CAA) made a provision that allows businesses that took out PPP loans to qualify. However, your number of qualified wages depends on your PPP loan forgiveness application.

Learn About Our Services

How Our Team Protects Your Business

During the risk assessment phase of your Employee Retention Credit (ERC) application, we will provide you with a comprehensive list of potential risks associated with your claim, as well as an overview of each party’s responsibility. We recognize that each business is unique and has different risk tolerances. Therefore, we offer you the flexibility to structure your claim in a way that aligns with your individual risk tolerance.

To facilitate this process, we will provide you with a list of protections available to you, including their respective pros and cons. This approach empowers you to make informed decisions that best align with your business’s specific needs and goals. Our goal is to help you maximize your benefits while minimizing your risk exposure.

We understand the importance of transparency and clarity in our service agreements. That is why we are committed to providing you with a clear and concise outline of all promised protections. By doing so, we will ensure that you are fully aware of the risks involved and have complete control over how your claim is structured.

What Is Your Fee And When Do We Pay It?

At Accelerate America, we believe in putting safety first. As such, our fees are determined based on a number of factors, including the complexity and risk profile of your claim, as well as your chosen payment terms. Contrary to common misconceptions, a higher level of protection does not necessarily equate to higher fees.

The primary driver of our fee structure is the complexity of your claim. Processing these types of claims demands additional accounting resources, including the expertise of additional CPAs, consulting services for impact analysis, and review by our experienced Tax Attorneys. These resources are essential to ensuring that your claim is processed efficiently and effectively.

Rest assured, we are transparent in our pricing options and will communicate them clearly during the risk assessment phase. We understand the importance of providing our clients with accurate and detailed information about our fee structure, and we take pride in offering a level of service that is both reliable and affordable.

We are committed to putting safety first and delivering top-quality service to all of our clients. Whether your claim is simple or complex, we are here to help you navigate the process and achieve a successful outcome.

Employee Retention Credit Scams
Employee Retention Credit

Employee Retention Credit Scams

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