How does the Employee Retention Credit work?
The pandemic of COVID-19 hit companies hard in 2020, which is still visible in 2021. Although we hope that an end will soon be in sight, many small company owners must act to keep their companies flourishing. Fortunately, Congress has passed a number of laws offering company owners across the country some relief. The credit for employees withholding tax is one source of relief for small enterprises. This tax credit could first be claimed on quarterly tax returns by the qualifying employers under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. This program was enhanced to make credit more accessible to businesses by the Consolidated Appropriations Act that was passed in December 2020. This blog will break the Employee Retention Tax Credit in this post. We will examine how you qualify, how your credit amount is calculated and the adjustments enacted for 2021. About Employee Retention Credit (ERC) The Employee Retention Credit is a repayable employer tax credit, wh