Businesses of all sizes are facing intense pressures, ranging from inflation to post-pandemic fallout.
The Payment Protection Program (PPP) and, for many, the subsequent PPP loan forgiveness provided some much-needed support to business owners.
However, a lesser-known program, the Employee Retention Tax Credit (ERTC) is currently saving businesses in these challenging times — and yet, the average business owner doesn’t even know about this form of government aid.
That’s why we are excited you stumbled on our list of the best Employee Retention Tax Credit (ERTC) Services. Besides, it’s time for you, the taxpayer, to get what Uncle Sam owes you!
But first…
What is an Employee Retention Tax Credit (ERTC) Service?
The Employee Retention Tax Credit (ERTC) is a refundable tax credit against payroll taxes equal to 50% of qualifying wages paid to eligible employees during the COVID-19 pandemic.
The credit is available to employers of all sizes and is retroactive to March 13, 2020. To be an eligible employer, a company must have been carrying on a trade or business during 2020 and either had its operations fully or partially suspended due to a government order related to COVID-19, or experienced a significant decline in gross receipts.
Wages eligible for the credit are capped at $10,000 per employee per quarter. The credit is available for 70% of qualified employee wages (raised from 50% in 2021) paid from March 13, 2020, through December 31, 2021. The Employee Retention Tax Credit has also been updated for 2021, increasing the percentage
The ERTC Service provides businesses with an easy way to claim the Employee Retention Tax Credit. With an ERTC service, businesses can quickly and easily estimate their potential credit, calculate their payroll taxes, and file for the credit all in one place. At the end of the day, a service like ERC Assistant helps to make the process more straightforward so businesses can focus on what they do best – running their business.
Learn more about how our ERTC Service can help your business today.
What are the benefits of using an ERTC service?
There are several benefits to working with an ERTC service. While we could go on all day covering these benefits, let’s look at a few key reasons why these services are helpful:
➤ Employee retention
Employee retention is a big challenge for businesses. The costs of recruiting and training new employees can be high, and high turnover rates can hurt morale and productivity. If you can’t afford to retain employees, you end up being forced into the agonizing position of having to lay off your valued team members. Fortunately, an ERTC service can help you take advantage of this incentive by claiming the credit on your behalf and providing ongoing support to ensure that you meet the eligibility requirements and can keep your employees.
In addition to financial incentives, an ERTC service can also provide access to valuable resources and support, such as HR advice, guidance on best practices, and assistance with developing retention strategies. By partnering with an ERTC service, you can take steps to create a more stable and productive workforce.
➤ Better business health
The service can help businesses with the costs of payroll taxes, health insurance, benefits, the cost of recruiting and training new employees, and the financial aspects of employee retention by providing several different services.
➤ Increased budget
For businesses, one of the most important – and expensive – investments is in human resources. Your employees are your most valuable asset, so it’s essential to keep them happy and engaged. But that’s not always easy, and it can be costly. That’s where an employee retention tax credit service comes in. By providing financial incentives, such as tax breaks, to businesses that retain their employees, these services can help increase a company’s budget. In turn, this can help businesses invest more in their workforce and improve employee retention rates.
➤ Little to no work for you
You might be asking yourself what is the employee retention tax credit anyway? ERC services provide dedicated advisors who have been at the forefront of educating the public and guiding clients to maximize COVID relief benefits. They continuously monitor new guidance from the SBA, as well as the Treasury, Congress, and the IRS, to ensure they have the latest information when advising their clients. As a result, businesses can rest assured that they are getting the most up-to-date information and advice when it comes to maximizing their COVID relief benefits.
➤ Enjoy having an experienced team
Most ERTC services have COVID relief benefits experts that specialize in their ERC vs Paycheck Protection Program (PPP loan-related) expertise. Additionally, you get to leverage the collective intelligence and experience of a team of experts instead of depending on a singular source of truth. This is extremely beneficial because you can get multiple insights and perspectives on the best way to approach your unique situation. Getting input from many different people also helps to ensure that you are getting accurate and up-to-date information. In addition, the team approach allows you to focus on running your business while the experts handle the details of the relief benefits process.
The Top 3 Best ERTC Services That Will Maximize Your Employee Retention Credit
1) ERC Assistant
What is ERC Assistant?
ERC Assistant is an ERTC service that gives you the ability to take a 60-second quiz, select a firm, and see if you’ll receive a check directly from the IRS.
Why you should use this ERTC service: ERC Assistant is run by a team of business owners, who were impacted by the coronavirus (COVID-19). Now, reinforced by their own experience of getting triple what they expected during this same process, they set out to help other business owners achieve the same results. Their goal is to facilitate your best-case scenario — ideally, $26,000 per employee! After working for small businesses for years, they have a ton of ERC examples to show the potential of your claim.
Where to learn more: ERC Assistant
Tip: Take this 60 second quiz to see if you qualify for the ERTC today!
2) BLC
What is BLC?
BottomLine Concepts (BLC) is a straightforward submission platform for the Employee Retention Tax Credit. Simply enter your first and last name, email, phone number, legal business name, number of W-2 employees, and the industry. BLC audits for refunds and negotiates for savings.
Why you should use this ERTC service: BLC launched its Government Aid Division specifically to help businesses impacted by Covid-19. This ERTC service specializes in maximizing the ERC program. Part of what makes this one of the best ERC services online is that they have a team of dedicated experts to guide you and outline the steps you need to take to maximize your claim for your business. Additionally, the ERC has gone through several iterations with tweaks to the program as time has passed, including which employees are eligible, how to determine qualified wages, and more, so certain businesses need a more intensive analysis and review. BLC is here to help with that and answer any ERC frequently asked questions you may have.
Where to learn more: BLC
3) Omega
What is Omega? Omega is a full-fledged team of accountants and tax professionals, who work to help business owners make informed business decisions through the production of accurate and timely books that yield honest and insightful reports while leveraging the assets within the business — as well as Omega to maximize efficiency.
Why you should use this ERTC service: Omega builds long-term relationships and partnerships between staff and clients, recognizing each relationship as an investment. Every business is treated as if it is its own, with the particular goal of exceeding your expectations. With this ERC service, you gain a fractional team of CFOs, Controllers, Business Intelligence, Senior Accountants, and Accountants.
Where to learn more: Omega
Who is eligible for the Employee Retention Credit?
An eligible employer for the employee retention credit in 2020 is any private-sector employer or tax-exempt organization carrying on a trade or business during the calendar year 2020, that either:
- fully or partially suspended operations during any calendar quarter due to orders from an appropriate government authority limiting commerce, travel, or group meetings due to COVID-19; or
- experienced a significant decline in gross receipts during the calendar quarter.
Eligibility rules have been updated for 2021.
To be considered for the credit, more than a nominal portion of the employer’s business operations must have been suspended. For the employee retention credit, a portion of an employer’s business is considered more than a nominal portion of operations if either the gross receipts from that portion of business operations are not less than 10% of gross receipts (determined by the same calendar quarter in 2019) or the hours of service performed by the employee is that portion of the business is not less than 10% of the total number of hours of service performed by all employees in the employer’s business.
What constitutes a partial suspension of business operations?
To qualify as partially suspended, an employer’s business operations must have been limited due to a federal, state, or local order, proclamation, or decree that affected the employer’s operations.
For example, a restaurant that had to close its dining room due to a local government order but could continue to offer carry-out or delivery service was considered to have partially suspended operations.
Partial suspension of business operations could occur because an order limiting the number of hours a business could be open, or some business operations had to be closed and work could not be performed remotely.
Employee Retention Credit Eligibility tool
Due to the complexities of eligibility for the employee retention credit, Thomson Reuters has updated the Employee Retention Credit Tool to help all employers discover their eligibility for the credit.
How do I calculate the Employee Retention Credit?
The 2021 COVID-19 employee retention credit is equal to 70% of qualified wages. The maximum amount of qualified wages for any one employee per quarter is limited to $10,000 (including qualified health plan expenses), with maximum credit for a quarter concerning any employee of $7,000 (for a total credit of $28,000 per employee for the calendar year 2021).
How do you claim the employee retention credit?
Employers reported total qualified wages and the related COVID-19 employee retention credit on Form 941 for the quarter in which the qualified wages were paid. Wages paid during the period March 13-31, 2020, that qualified for the employee retention credit were reported on the second quarter Form 941 (Employer’s Quarterly Federal Tax Return) to determine the employer’s credit for the quarter ending June 30, 2020. The credit was allowed against the employer portion of social security taxes (6.2% rate) and railroad retirement tax on all wages and compensation paid to all employees for the quarter. Although it should be noted that different rules apply for 2021. If the amount of the credit exceeded the employer portion of those federal employment taxes, then the excess was treated as an overpayment and refunded to the employer.
An eligible employer could reduce its employment tax deposits during the quarter by the anticipated credit amount for the quarter. The employer could retain federal income tax withheld from employees, the employee’s share of social security and Medicare taxes, and the employer’s share of social security and Medicare taxes concerning all employees. If the employment tax deposits retained were not enough to cover the anticipated credit amount the employer could file Form 7200 (Advance Payment of Employer Credits Due to COVID-19) to request advance payment of the remaining credit amount.
Additional limitations exist for 2021 – the credit is now available to small employers only.
Employers that did not claim the 2020 or 2021 employee retention credit on a quarterly payroll tax return can file an amended return for each quarter for which the credit can be claimed. Employers that file an annual payroll tax return can file an amended return using Form 944-X (Adjusted Employer’s Annual Federal Tax Return or Claim for Refund) or Form 943-X (Adjusted Employer’s Annual Federal Tax Return for Agricultural Employees or Claim for Refund) to claim the credits.
Is the ERC going to expire?
On August 4, 2021, the IRS released Notice 2021-49 that provides additional guidance regarding claiming the Employee Retention Credit for employers who pay qualified wages after June 30, 2021, and before January 1, 2022 [IR 2021-165, Notice 2021-49]. The ERC was due to expire on December 31, 2020. However, the Consolidated Appropriations Act (CAA) 2021, extended the ERC through June 30, 2021. The CAA also expanded the ERC rate of credit from 50% to 70% of qualified wages. The ERC was extended again to 12/31/2021 and then retroactively ended as of 9/20/21.
Can you get the Employee Retention Credit and Paycheck Protection Program?
The CARES act states that any employer receiving a Paycheck Protection Program loan was not eligible for the Employee Retention Credit unless the PPP loan was repaid by May 18, 2020. The Taxpayer Certainty and Disaster Tax Relief Act of 2020 later repealed this provision, making recipients of a PPP Loan eligible for the Employee Retention Credit. However, wages paid with the PPP loan that is forgiven do not count as qualifying wages for the credit.
