The process can be complicated and requires accurate data to ensure that youâre getting the full amount of support available to you.
A ERTC calculator can simplify the process, making it easier for you to get the money you deserve. This post will walk you through exactly how to use it.
Online ERTC Tax Credit (ERC) Calculator
ERC is a complex program and a miscalculation could result in IRS penalties. Thatâs why itâs important to consult a reputable tax professional. Theyâll verify your eligibility, file your 941-X and walk you through the timeline.
To qualify for the ERC, your business must have experienced a significant decline in gross receipts during one or more of the financial quarters youâre applying for the credit. You can calculate this using the ERTC Calculator. The amount of the credit depends on your qualified wages, which includes FICA employee wages and employer-paid group health insurance. You must also exclude owner wages and any wages paid to ownersâ family members.
To be eligible for the ERTC, your business must have suspended operations entirely or partially due to government orders or a decline in gross receipts. It also must have documented its efforts to mitigate the impact of COVID-19. This documentation must include a letter from the local health department. If you used Paycheck Protection Program loans, make sure to document that.
Eligibility requirements
As the ERTC has gained popularity, disreputable scammers have tried to exploit it. These scammers often falsely claim that businesses and tax-exempt organizations have nothing to lose by claiming the credit. The IRS urges businesses to seek out a trusted tax professional for guidance.
To qualify for the ERTC, your business must have experienced a significant decline in gross receipts. This means that your gross receipts have dropped by 50% or more during a quarter in 2020 or 2021 compared to the same quarter in the prior year. You must also have documented the impact of the COVID-19 pandemic on your business.
To claim the ERTC, use Form 941 (Employerâs Quarterly Federal Tax Return).The credit is reported on Online ERTC Tax Credit (ERC) Calculator this form and used to reduce your federal employment tax deposits. Consult a tax professional for guidance on determining your eligibility and preparing the
required
documentation. In addition, a tax professional can help ensure that youâre calculating the credit properly to maximize your benefits.
Scams
The airwaves and Internet have been awash with advertisements encouraging businesses and tax-exempt organizations to file ERC claims, but many of these promoters misrepresent eligibility requirements. The IRS warns that those who claim the credit without proper eligibility can end up having to repay it with interest and penalties.
Another scam involves fraudsters who make false ERC claims on behalf of their clients, often charging an upfront fee or a percentage of the credit refund. These companies may not actually prepare and submit the proper documents, or they may even overstate the credit amount in order to keep more money.
Working with a trusted tax advisor and staying alert to aggressive marketing can help prevent fraudulent ERC claims. If youâre worried that you or your business has fallen victim to one of these scams, contact Ramos Law to receive the legal assistance you need. Weâll fight to protect your rights and restore your financial stability