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The Employee Retention Credit is a new credit that came out of the CARES act. The federal government put it in place to try to keep employees employed. They are giving employers money back to ensure this.
The credit is basically a refund of the Social Security and Medicare taxes you have paid on your employees’ wages. The idea behind the credit is to defer your payroll taxes. By the time the taxes are due, you will have this credit so you potentially won't owe them.
However, as with everything in the CARES act, things are constantly changing. Today, we discuss how the ERC works, which types of businesses can take advantage of it, and the new changes that have been implemented in 2021.
In this episode, you will hear:
- Businesses that qualify for ERC
- $5,000 credit cap in the entire 2020
- $7,000 credit cap per quarter in 2021
- How to apply for the ERC and how it gets credited
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