If Your Business Is Eligible, You Can Use This Tool To See If And How Much Your Employees Could R …

This calculator can be used for both 2021 and 2022 ERC claims. The calculation for the ERC is complex and requires a significant amount of data to accurately calculate. There are many variables that come into play that can impact your ERTC refund, including the total number of qualified wages paid, and whether the payments were made before or after the COVID-19 pandemic.

ERC Eligibility

To qualify for the ERC, businesses must have either:
(1) experienced a period of full or partial suspension of operations during the 2021 financial quarters for which the claim is being submitted as a result of governmental orders or other mandates; or (2) experienced a significant decline in gross business receipts over the same quarter in the prior year. A business can also meet the eligibility criteria by demonstrating that it is a recovery startup business.

To demonstrate the decline in gross business receipts, the tax return must include a quarterly comparison of the company’s gross business receipts for the same quarter in the previous year, and it must be shown that those business receipts declined by 50% or more. For the 2021 ERC claim, the revenue loss must be 20% or more.

Calculating the qualified wages is a more involved process than simply reviewing the company’s Form 941s and federal tax returns. To determine the amounts of qualifying wages paid, a professional needs to review the company’s records and determine which financial quarters qualify for the credit based on the determining factors discussed above.

Qualifying wages are those paid to the employees on which FICA taxes are charged, including wage-based compensation, salary and other taxable fringe benefits, the cost of qualified health plans, severance pay and vacation time. However, it is important to note that the wages cannot be used for any payment of family members, or for meals, hotel stays and other expenses incurred by the owner or spouse.

The ERTC is an important relief opportunity for those that were negatively impacted by the pandemic. It is essential that you understand the complexities of this tax credit, and that you have a trusted advisor that can help you

navigate

and maximize the opportunity to get your money back. If you are looking for guidance and assistance with the ERTC, the Dean Dorton Accounting & Financial Outsourcing team is here to assist.We have been closely following the changing ERC opportunities and can provide consultation, collaboration or How does the ERC Work confirmation as needed. Contact Kaydee Ruppert, Accounting & Financial Outsourcing Manager, to discuss your situation and how we can help