Understanding the Employee Retention Credit: Get the Most for Your Small Business
Employers are urged to take advantage of the newly-extended Employee Retention Credit (ERC), which made it easier for businesses to keep employees on the payroll during COVID-19, but many do not know where to begin. Under the recently enacted American Rescue Plan (ARP) Act, and previously under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, the ERC can now be claimed through December 2021 by eligible employers who retained employees during the COVID-19 pandemic.
KLR's Anthony Mangiarelli, CPA, MST, Partner and Director of Enterprise Solutions, will discuss the changes to the ERC which include modifying and extending the program for six months through June 30, 2021. As a result, eligible employers can now claim a refundable tax credit against the employer share of Social Security tax equal to 70% of the qualified wages they pay to employees between January 1 and June 30, 2021. Qualified wages are limited to $10,000 per employee, per calendar quarter, in 2021. Thus, the maximum ERC amount available is $7,000 per employee per calendar quarter, for a total of $14,000 in 2021.
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