How Much ERC Can I claim?

Every eligible employer can receive 70% of the credit according to the qualified wages. The maximum amount that an employer can claim is $10,000. It is a huge tax relief; however, you must meet certain requirements.

As per the conditions set by IRS, you can only apply for the ERC tax service if

• You have employees between 1 to 500.
• Also, your business operations were affected fully or partially due to government restrictions.
• Or you have faced a decline of more than 20% in your gross receipt. You can compare the gross receipt of the current quarter to the corresponding quarter of the previous year.
• You must not be a self-employed individual. However, you can still claim the ERC for your employees if you are.
• You can’t apply for the ERC if you have availed of the PPP loan.

So, if you qualify for all of these conditions, you can apply for the ERC. To apply, you have to go to the IRS website and fill the form number 941. However, if, under certain circumstances, you have to apply for the advance credit, you have to use form number 7200. Filling the form number 7200 provides a significant lifeline to the businesses that need more cash.

The credit process can take some time, depending on the circumstances. But, when you receive the amount, you can use it to keep your permanent employees on the payroll. The benefits of the ERC make it an important tax relief under the CARES Act. However, it can sometimes be difficult to understand and qualify for the ERC. So, it is always a good choice in those cases to have an ERC consultant by your side. A consultant makes the ERC applying process smooth and guides you through the formalities. Therefore, if you need to seek help, don’t hesitate.

Read More: Who Can Qualify for the ERC?