ERTC Eligibility | Who qualifies for the employee retention tax credit?

Hey, how are you? This is Matt with ERG, and today I'm going to help you determine if you are eligible for the incredibly valuable Employee Retention Tax Credit program. The ERTC was rolled out last year in an effort to help provide some relief to employers who were negatively impacted by COVID-19, whether you were shut down by a government, government order, or you had a reduction in gross receipts or income. This program is here to help you recoup some of the money that you paid to your employees and the form of a tax credit that can either be applied to your 941s or you can get a check back from the government. And there's been huge returns on this. So I'm excited to share the program. We're going to walk through how to determine if you're eligible and then next steps if you think you are eligible. So with that said, I'm going to go ahead and share my screen and dive right in. Hi, so let's talk about ERTC and what you can do to get your credits. So today we're going to cover the eligibility. Are you eligible? What the process looks like if you are, and some of the challenges you may run into as an employer. First, I want to share a few of the recent wins we've had. We've processed over $35 million in credits for employers, and I think that's really important because we're seeing a lot of sort of fly-by-night companies come in and help people with this, but we just don't know where they're gonna be in the next few years. And a really good example of this is I actually had one of these companies reach out to me back when this first started and see if we wanted their help with processing the credits for our clients. And the CEO straight up told me, he was like, "I'm going to make $10 million off of ERTC credits and then retire." And this was a new business for him. And he's talking about making a bunch of money and then retiring, which makes me wonder where he's gonna be in 5 years if you get audited and you need some help. And you have some questions. So, uh, make sure you know who you're working with on this stuff. But here are a couple recent wins for us. One, one down there at the bottom that's really near and dear to my heart. You look at this client, there's only 11 employees, uh, they got $41,000 in credits for 2020, $109,000 in credits for 2021. I mean, think about that. That's life-changing money. That was literally a person in tears over how great of an opportunity this was for the business and for them to recoup some of the losses incurred over the last 24 months. And you can see some of these other great success stories ranging in size, you know, 11 all the way through to 5,200 employees, 8 all the way through. And you can see there's plenty of opportunities here regardless of your industry. So once again, talking about the experience working with ERG Payroll and HR, I think it really matters if you know, if you're going to work with somebody on ERTC, who you're working with. You look at some of these reviews, one of these reviews from 3 years ago, and they're talking about having worked with us for over 3 years. We've been doing this for about 7 years. We've moved over $1 billion in payroll money, and now we're helping our clients and other folks to recoup the ERTC. We're doing so at a reasonable rate because we know it's the right thing to do. And we also are going to apply the same level of client success and satisfaction to you should you partner with us that we did with some of these other clients. So, you know, I love working with Dr. Gillespie. I love working with Jill. And, you know, she's always been a big advocate of ours. And we've not always done everything right. But what we try to do is make things right if anything is ever wrong. And we're going to do the same thing when it comes to processing employee retention tax credits. And, you know, I really love this review from Brennan where he talks about the exceptional service and also the, the fact that we give back to the community. So one of the great things about our organization is that we give 5% of our business away to nonprofits and 3% of all of our revenue, 1% of our time, and 1% of our product. And so that experience over the last 7 years and moving all that money and processing, you know, thousands and thousands and thousands of payrolls and filing all the taxes associated with that has prepared us well for helping our clients with Employee Retention Tax Credit. So let's look at eligibility requirements. So there's going to be different eligibility almost down to the quarter, down to the quarter for 2021. In 2022 or 2020, we've got eligibility that really boils down to two things. So you don't have to qualify both of these, it's either or. So were you fully or partially suspended by the government order due to COVID-19? So I think about, we're in South Carolina, we had an executive order from the government, or for the, from the governor, excuse me, that had businesses shut down, like, um, you know, gyms and salons and things like that. And, and certain places were forced to close their doors for an extended period of time, restaurants. And so That's a no-brainer, obvious eligibility there. And if you were suspended partially, so let's say you were more of a white-collar environment, but you still had to partially suspend, there are still some opportunities there. Just need to talk through those to make sure. One of the things that we're not doing that some others are is getting super aggressive with reading what the possible suspension could mean for you. Our business is a great example. You could technically say that we were partially suspended due to the government shutdown. Everybody had to go home. We, you know, couldn't work in in our office anymore, but we were still working at full steam. And so it's just, if anybody were to ever question that, I don't think that it would hold up. And so we're not gonna file those credits, but there are certain other folks that were more negatively impacted than we were. Or you have the second bullet here. So it's either or, not both. Gross receipts below 50% of the same quarter in 2019. So if you've got below for that one quarter, you can still get credits for that quarter. And we're comparing to 2019, which is important because that's what we're doing in 2021 as well. We're comparing to 2019 not 2020. So one of the cool things that they did here and why this program is so hot right now is because the PPP limitation was removed retroactively. So when this first rolled out, one of the reasons why many of us were not all over it as employers was because if you got the PPP loan, you couldn't also get ERTC. That's gone. If you got PPP, you can still get ERTC, and we can help you to maximize those funds you get. All right, so ERTC qualifications 2020 employer status, where the, the number is close— important to pay attention to here because it changed in 2021. Employers with less than 100 employees, credit is based on wages paid whether or not they were working. Doesn't matter, just wages paid whether or not they're working. More than 100 employees, credit is based only on wages paid to employees who did not work. So if somebody wasn't working and you were paying them still So, so, you know, we had folks getting their salary still even though they were unable to get into work because of government orders. That'd be a perfect example of somebody who'd still be eligible even if you have more than 100 employees in 2020. So 2020 qualified wages. Eligible employers can receive a credit for up to 50% of qualifying wages paid after March 21st, 2020 for a maximum credit of $5,000 per eligible employee. So 50% of qualifying wages. After March 21st, maximum credit of $5,000 per eligible employee. So that's pretty awesome. Um, you know, you got 10 folks, you qualify from March 1st on, $5,000 apiece, that's $50,000 in credits. Tremendous opportunities here. Uh, those wages include wages paid and certain healthcare plan costs. All right, so let's take a look at 2021. And some of this has changed, some of it's the same. So one of the things to keep in mind here is that there's not an either-or with it when it comes to 2020 or 2021. You could be eligible for one quarter in 2021 and that's it, or you could be eligible for 2020 and no quarters in 2021, or two quarters in 2021 but not 2020, and not the other two quarters in 2021. So, you know, we could have up to five different calculations here. And so definitely look at each quarter and see if any of these things apply. So once again, first and foremost full or partial suspension by the government, or gross receipts 20% below same quarter in 2019. So it dipped a little bit here. We're still using 2019, 20% less. PPP limitation once again removed. So 2020 qualification, one thing that did change is they moved that from 100 to 500. So credit is based on wages paid less than 500, which is awesome. This opens it up to a whole new class of employers. And even if you have more than 500, but you paid people that were not working, you still have eligibility there as well. So qualified wages in 2021— this is huge— you can receive a credit for up to 70% of qualifying wages paid in Q1, Q2, Q3, Q4 for a maximum of $7,000 per eligible employee. So these wages include wages paid and certain health care plan costs. Just tremendous opportunity once again to see money coming back to your bottom line. That was paid out in these wages. And the eligibility and the opportunity to get out in front of some of these things and get the money a little bit faster for 2021 is great. So let's talk about some of the challenges you're going to face in trying to recoup these credits. So obviously there are some— this was just rolled out last year. It continues to evolve. Every time we think we've got one thing nailed down, you know, that something else pops up. It's like a game of whack-a-mole. There's a lot of uncertainty. There's a lot of complexity. You know, going down there, you're going to see that the templates that you're finding online, you don't know when they're from, who made them. They're, they're not from the IRS. I'll tell you that. They didn't put any templates out on their website. So, uh, we talked earlier about some of these companies that you might be partnering with not being here tomorrow to actually help you when you get audited or when the IRS has a question about the validity of the taxes. So what are they going to do to support you long-term? You could end up spending, if you determine that you want to try to do it yourself, you could spend tons of time and effort only to not be sure, to make an improper calculation, or to determine that you're just not eligible even. We've seen a lot of folks where they get to us, by the time they get to us, they're like, "Hey, we've done this, we've done that, we've processed all these," and we've looked at it and said, "Well, we don't even determine that you're eligible at this point." So, you know, that last question of who's going to help you if you get audited. So is the company going to be around in 5 years, 3 years, 2 years? You know, you want to make sure that you've got somebody with a proven track record record of success and, you know, what a partner that you can trust in the process. Because really you've got two options. You can either do it yourself, which we talked about some of the possible landmines there, or you can follow a proven roadmap and work with a company like ours that's processed more than $35 million in credits for hundreds of companies and has a system and a process that can make this very simple and easy for you. And we even remove the risk because we only pay— you only pay us if we successfully capture credits. So if you want help, it's pretty simple. We jump on an eligibility call and there's a button on the website link below this video. We will calculate and file the amendments for you. So we'll get a list of all the documents we need from you. Takes about 30 minutes to pull all that stuff together from your side. We will actually do everything from the calculation, certification of the credits all the way through to filing the amended 941-Xs. And then depending on the timing of the credits, you may— we may submit those 941-Xs with, um, if it's an amendment for 2020, we'll submit it. You will get a payment, a check back from the IRS. Some of those are coming as quick as 10 days, some are taking 10 to 12 weeks, but ultimately you will get that cut back to you as a check. And you only pay us if we successfully capture, uh, credits, if you're eligible for credits. We don't— if we determine that you're ineligible, even if we get to here then you don't owe us anything. So we've really de-risked this entire process for employers. So it's a pretty simple process. If you're looking for some help, you can book a time. Like I said, there will be a link down below. Within 14 to 21 days, we'll have all of your initial eligibility determined, and, uh, the calculations will have been done in that time frame to determine how much you're eligible for. Within 35— within 30 days, we're going to have the credits fully certified and amended 941 submitted for your return of the credit. So within 30 days, we can turn this whole thing around, assuming that you get us the data over in a timely fashion from the time we booked this time to getting started here. But we will sit on a call with you. We'll do a Zoom. We'll help you to pull the reports out of your QuickBooks, out of your accounting system, out of your payroll system if you're not a payroll client of ours. So we try to make it as simple as possible for you. So what do you need to do to get started? Book an eligibility call. So once again, you're going to see this button on the link below to click here to see if you qualify. There's no strings attached. You can jump on this call, we can talk through it for 15 minutes, 30 minutes, whatever it takes to determine if you have any possible eligibility. And then we will go ahead and determine that in more detail if you do after the call. So appreciate you checking this out. Hopefully you determined that you, you were able to determine whether or not you think you're eligible or ineligible based on this. If you want to talk through it further and determine a little bit more clearly, then just go ahead and grab a call in here and we'll be happy to help in any way we can. Thanks so much for your time. I look forward to speaking to you.