It may seem to some that the pandemic is good and gone, but its effects surely are not. This can be seen in the prevalence of remote work, the focus on safety in workplaces, and in lasting legislation. One piece of legislation that is still relevant to businesses today is the employee retention credit.
This credit was created to encourage businesses and employers to keep their employees paid. In a time where there were more layoffs and destroyed businesses than ever, this was extremely important. At the time, this was a useful tool for some businesses to do exactly what the credit intended. They kept employees, they saved tens of thousands later in the tax credit.
Yet many businesses, although capable of utilizing the tax credit, have not. Considering that the program ended in 2021, this seems like a lost cause, but the money earned is still available. All it takes is businesses submitting a tax amendment and the credit can still be applied to this day. Of course, not all businesses can utilize the credit, even if they kept employees full-time during the pandemic.
The main things to keep in mind to know if a business applies are as follows. First, was there decreased revenue due to COVID? Second, did the government suspend or limit the business? Third, was the business a specific organization such as a university or nonprofit? And finally was the business a Recovery Startup Business.
After this, and with properly qualified wages, the credit should be relatively simple to require. The credit applies differently to different businesses. In 2019 if the business has less than a target number of employees, the credit is more comprehensive. If more than the target number, the credit will only apply to select employees. Regardless, COVID and the pandemic was a challenging time for any business. For those that can gain something back for keeping their employees onboard, make sure not to miss out.
Infographic Source: https://creditleagues.com/what-is-the-employee-retention-credit/