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Find Out If Your Small Business is Eligible for the Employee Retention Credit

ERC Credit

September 9, 2022

As part of the Biden-Harris Administration’s Coronavirus Aid, Relief and Economic Security Act (CARES Act) recovery programs, small businesses that kept employees on payroll during the pandemic are eligible to receive the quarterly 2021 Employee Retention Credit (ERC). Businesses can still claim the credit retroactively — however, wages paid now cannot be claimed under the credit today.

To claim ERC of up to $7,000 per quarter per employee (or $28,000 per year per employee), the following criteria must be met:

  • Businesses must have 500 or fewer employees
  • Businesses must have been fully or partially shut down due to a governmental order during any part of the quarter
  • The business’ gross receipts in a quarter must have declined more than 20% compared to either the same quarter in 2019 or the immediately preceding quarter in 2020 or 2021

How to Apply

Applying for the ERC can be done on Form 941-X for relief credits missed. The statute of limitations period for filing this form is three years from when the original return was filed. See instructions for Form 941-X here.

For small business owners with questions about the ERC, a tax advisor will be able to assist. Search the Greater Des Moines Partnership accounting and tax professional directory.

Learn more at treasury.gov/coronavirus.

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Meg Schneider

Meg Schneider is a member of the Forbes Nonprofit Council, an invitation-only organization for senior-level executives in successful nonprofit organizations.