Frequently Asked Questions
Can I Get ERC Funds If I Already Took The PPP?
Yes. The Taxpayer Certainty and Disaster Tax Relief Act of 2020, enacted December 27, 2020, modified the ERC credit rules. One of the modifications included allowing a company to have a PPP loan and still take advantage of the ERC credit. However, you can't use the same dollar for dollar funds. We take this into account when processing your ERC credit.
My Revenue Went Up In 2020, Can I Still Qualify For The ERC Program?
Yes! There are two possible qualifications for 2020: revenue reduction, or a "full or partial shutdown of your business due to COVID-19". Specifically the IRS describes this as "A government authority required partial or full shutdown of your business during 2020 or 2021. This includes your operations being limited by commerce, inability to travel or restrictions of group meetings." Below are several examples of qualifying events:
Example 1: A restaurant must close or limit its on-site dining, such as having to close down every other table, due to COVID-19 restrictions.
Example 2: A business that needs to meet with clients in person and has to cancel meetings due to COVID-19 restrictions.
Example 3: A business has to reduce their operating hours because of COVID-19 restrictions and cleaning requirements.
Example 4: A business with a planned event has to cancel that event, or restrict the amount of people who can attend, due to COVID-19 restrictions.
Do I Have To Repay The ERC Credit?
No. This is not a loan. It is a refundable tax credit. When we file your ERC claim we request a refund check for you.
I'm Getting More In ERC Credit Than I Paid In Taxes?
Remember that this program is taken according to payroll taxes paid, not on income taxes. ERC funds not applied towards owed payroll taxes are treated as an 'overdeposit' of taxes that will be requested as a refund check from the IRS.
Will The ERC Funds Run Out?
This is not a lending program - tax refunds are issued by the US Treasury. Therefore, all eligible employers will receive the funds. However, the IRS backlog grows daily. As this continues to grow the wait time for funds to be sent could grow longer and longer.
Is The ERC Credit Taxable?
No, but the IRS guidance suggests the employer portion of the FICA refunded will become an add-back against the claimed payroll expense. Once you receive your ERC refund make sure you update your CPA on the amount received for their guidance.
Can I Qualify For The ERC If I'm Self Employed?
No, this program applies to W2 payroll taxes paid. The IRS has also stipulated that spouses and children of owners paid on W2 also do not qualify for the program.
Can't I Just Have My CPA File? Why Would I Use ERC Specialists?
Of course. The challenge is the ERC credit is taken on your payroll returns and not through your business income tax returns, which is what most CPA's handle. Because of this most CPA's don't process this credit, unless they process your payroll in house. This is also a big reason why this credit is so underutilized. Since CPA's don't typically handle it and they are the tax experts, it has mostly fallen in a middle ground where few are able to effectively process the credit. Interestingly, we receive a large portion of our clients from CPA's.
At ERC Specialists we have decades of payroll experience, which has allowed us to specifically focus on understanding and maximizing the ERC program. In our experience we have found that due to the complexity (the ERC tax code is over 200 pages) and time investment necessary to understand the ERC program, very few are able to effectively maximize this sizeable credit for your business.
I'm A CPA Or A Payroll Company, Can I Refer My Clients To ERC Specialists?
Yes. We also offer a referral/affiliate program. To learn more contact us.
How Much Do You Charge?
We charge a flat fee for our services based on the amount of employees that qualify for the ERC. This is in alignment with how the IRS requires tax consultants and preparers to charge for services. We calculate and provide our fee with our free analysis. Since we are typically able to recover 10-20% more than someone less familiar with the program, our fee is very affordable. Just like a good CPA, using the right team for this process pays for itself.
How Will I Pay The Fee?
We understand your refund check may not arrive for several months (16 weeks minimum according to IRS documentation), so we offer two payment options. You can choose to pay your fee up front by credit card or, if you prefer, the full fee can be deducted from your refund once received. Regardless, our fee is covered by a 100% Money Back Guarantee. If the IRS does not release the credit claimed for any reason, we will refund any payments made.
How Long Does It Take To Get My ERC Credit?
This is how the process works: you send us the required documents and we process an analysis at no charge. This analysis typically takes 3-5 days to complete. If you wish to move forward, you will select your desired payment option and we file your claim. Once filed, refunds are released based on IRS backlog. Currently, the IRS has stipulated a 16 week minimum turnaround on the ERC refunds
About ERC Specialists
ERC Specialists is a specialty payroll company exclusively dedicated to understanding and maximizing the CARES Act Employee Retention Credit (ERC) for small businesses affected negatively by COVID 19.
