COVID caused countless individuals and businesses alike endless grief and annoyance. One government created piece of legislation meant to alleviate those issues was the Employee Retention Credit program. This tax credit applied for the 2020 and 2021 tax years, right during the pandemic. And although the program ended in 2021, the credit is still applicable through refiling today.
In terms of who qualified, U.S operated businesses who suffered due to COVID are the primary target. This can come in the form of revenue loss, supply chain issues, or limited work hours. In terms of what benefits the credit offers, to put it simply, money. The program is targeted at employers who kept their employees paid. At best the program offers $26,000 per employee over 2020 and 2021. More realistically though, employers can expect anywhere from $1,000 to $7,000 for each employee each year.
There’s a lot of variance in these numbers and in which employees apply. For example, businesses with under 100 employees can have the credit applied to all employees. While businesses with over 500 employees can expect the credit to apply to paid employees who did not work. So really, the benefits of the credit program are quite simple, thousands saved in paid employees. What’s important now is for each business that can take advantage to do their best too. While refiling is still possible today the program will eventually come to a complete halt. At that point any money owed will be lost forever.
