“For many industries we see the Employee Retention Tax Credit program as the single biggest opportunity for employers to get the federal support they need in 2021."
COLUMBUS, Ohio (PRWEB) August 18, 2021
In an effort to combat the ongoing economic fallout from the COVID-19 crisis, the government is boosting its efforts to support businesses with more robust incentive programs - including expanding the value of the Employee Retention Tax Credit (ERTC) program. Today, Clarus, the leader in world-class technology that enables every business to unlock the full value of tax incentives for innovation and growth, is announcing it has already helped SMBs claim $50MM in ERTC support and is revealing advice to help more companies leverage the program this year.
A recent Clarus survey of 500 business decision makers shows nearly half (44 percent) of businesses haven't participated in any incentive programs beyond PPP because they don’t know if their company qualifies. The ERTC, under the CARES Act, is a fully refundable payroll tax credit that allows eligible businesses to deduct up to 70 percent of up to $10,000 in qualified wages paid per employee per quarter for tax year 2021.
“For many industries we see the Employee Retention Tax Credit program as the single biggest opportunity for employers to get the federal support they need in 2021, and while it has not been widely recognized to-date as such - we believe in many cases it is more significant than PPP was in 2020,” said Brent Johnson, co-founder of Clarus. “Clarus is focused on helping every small and midsize business take advantage of ERTC and it starts by driving awareness for it so that more companies can easily tap into it. Clarus ensures companies know they are eligible, while also streamlining the process so business owners can focus on growth and not paperwork.”
Nearly four in 10 businesses say they manage incentive programs on their own. Almost all businesses (88 percent) say they would be more willing to use a solution to manage incentive programs if it was backed by accountants. As the leaders in cloud-based software created by tax and technology experts to streamline the process of claiming tax credits, Clarus is helping businesses better understand ERTC so they can continue rebounding and growing in the post-pandemic world.
What changed? The Consolidated Appropriations Act, 2021 extended and enhanced both the Paycheck Protection Program (PPP) and the ERTC program. Companies that received PPP loans may now also claim the ERTC. Congress also removed a restriction on dual support, so now employers can claim the PPP loan and an Employee Retention Tax Credit - including a look-back opportunity for businesses which meet the eligibility requirements of the ERTC in 2020.
Who is eligible? Companies qualify for the ERTC if they (1) had a decline in quarterly revenue, or (2) were fully or partially shut down due to governmental orders, or (3) began a new trade or business and previously had less than $1 million in average annual revenue.
What is it worth? For 2020, the ERTC is worth up to $5,000 per employee per year. In 2021, it’s now worth up to $7,000 per employee per quarter.
What Industries are impacted? Any industry which was negatively impacted by COVID-19 crisis. Especially significant are health-care, hospitality, restaurants and food-service, retailers, staffing, assisted living and even many not-for-profit organizations.
“The required coordination with PPP loan forgiveness made it unclear whether we qualified for the ERTC, for what period of time we qualified, and whether claiming it would negatively impact our PPP loan forgiveness,” said Travis Timmons, owner of Ohio-based physical therapy and wellness center Fitness Matters. “Clarus not only identified our eligibility due to impact from COVID-19, but after talking with their experts, we discovered we were eligible for the ERTC and we were able to take advantage. Clarus has been invaluable in helping us claim our tax credits during this difficult time.”
Clarus monitors more than 60 state and federal tax incentive programs and has helped companies secure more than $175MM in incentive dollars. To learn more and determine if your business is eligible for ERTC, visit http://www.clarusrd.com/ertc.
Clarus is the leader in world-class technology that enables every business to unlock the full value of tax incentives for innovation and growth. Founded by tax and technology experts, Clarus builds cloud-based software to deliver access, compliance, and clarity for federal and state programs. With Clarus, companies of all sizes can realize and optimize the power of government programs to materially impact their business. For more information, visit claruscredits.com.