Payroll News & Information
Employee Retention Tax Credit
Many businesses meet eligibility requirements for credit of qualified wages up to $21,000 per employee in 2021 and up to $5,000 per employee in 2020.
These credits can be applied retroactively with an amended 941 for any Quarter in 2020 and through Quarter 3 of 2021. (Common exclusions are PPP Loans used for wages and wages paid to owners and their family members.)
***Caution: outside services marketing these potential credits to employers is common. Be aware that these services may be charging up to 10%-25% of any credit received – which can be significant. We urge anyone who may be eligible for these credits to reach out to your accountant or to us at DSI before processing any amended returns***
General qualification criteria for most small businesses are:
- Trade or business was fully or partially suspended due to a government order
OR
- The business has suffered a significant decline in gross receipts;
-
- In 2021, a decline in gross receipts of 20% or more as compared to the same quarter in 2019 (or initial quarter for new business)
- In 2020, a decline in gross receipts of 50% or more as compared to the same quarter in 2019
Eligibility criteria should first be carefully assessed by you or your accountant to determine which quarters may qualify for this credit.
You may also reach out to us for more information