21031 Ventura Blvd Ste 401 - Woodland Hills, CA 91364 info@wscpas.net
21031 Ventura Blvd Ste 401 - Woodland Hills, CA 91364 info@wscpas.net
This is a reminder that the Employee Retention Credit (ERC) may be available for your business. The eligibility requirement for 2021 has been relaxed significantly. If you have employees and your business sales for fourth quarter 2020 were down by more than 20% compared to fourth quarter 2019, then your business would be eligible for the credit in first quarter 2021. The amount available is up to $7,000 per employee for the first quarter of 2021.
If your sales for the first quarter of 2021 are down by more than 20% compared to first quarter of 2019, then the ERC may be available for the first quarter of 2021. If you meet these qualifications your business will then qualify for the ERC for the second quarter of 2021. If you had 10 employees averaging $10,000 per quarter for both first quarter and second quarter of 2021, your business would receive a credit of up to $70,000 for first quarter of 2021 and an additional $70,000 for second quarter for a total of $140,000.
W&S has assembled a team of professionals that has invested time understanding the credit, how to maximize it, and how to apply for it to get immediate cash flow relief via reduced payroll tax payments.
Who to Contact
If you think you may qualify for the credit, please contact your W&S professional. You also have the option to send us a message via the website info@wscpas.net. Please reference “Employee Retention Credit” in the message field of the form and someone from the team will get back to you.
Information Needed for First Quarter 2021 ERC
The following pieces of information are needed for first quarter 2021 ERC:
1. Sales information for fourth quarter 2020 compared to fourth quarter 2019 to confirm more than 20% decrease.
2. Fourth quarter Form 941.
3. Fourth quarter 2020 payroll detail by employee.
4. Projected first quarter 2021 payroll detail by employee.
5. List of any employees that are relatives of a more than 50% owner.
6. Form W-3 (the cover sheet to the W-2s) from 2019.
Additional Information
The Consolidated Appropriations Act changes key provisions of the ERC and expands the applicability of the credit. These changes affect eligibility for both 2020 and 2021.
We are proud to advise you and offer you and your business the support it needs. Providing our clients with the highest level of service remains our top priority.
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