Construction Contractors Can Get Benefits From The Employee Retention Credit

The Construction Industry Can Benefit From The Employee Retention Credit

https://f004.backblazeb2.com/file/fkegfh/employeeretentiontaxcredit/Employee-Retention-Credit/Construction-Companies-Erc-Specialists-Employee-Retention-Credit.html

The ERC program refunded $148,000 to a Louisiana welding firm that didn't experience a decline of gross receipts. As stated previously, eligible employers can claim an ERC of 70% for calendar quarters that begin after December employee retention tax credit 2021 deadline 31, 2020 (increased from 50%) for Qualified Wages paid to employees after July 1, 2021 and March 12, 2020. The maximum amount for the ERC that can be considered is $10,000 per quarter by an employee.

#2 Misconception - My construction company is not eligible for ERC as it has not experienced a 50% or more decline in gross revenues. Contractors can take advantage of the Employee Retention Credit during the first and last quarters 2021 before filing their employment tax returns. Fewer than 500 employees - If your company has 500 or fewer employees, any compensation paid during the period when the operations were affected by one of the two scenarios above is eligible for the credit, whether the employees were working or not. For the 500 employee threshold to be met, it takes careful analysis.

Should Construction Companies File For The Employee Retention Credit?

The ERC could potentially be worth as much as $7,000 per employee per quarter in 2021. In terms of timing, Qualified Waives are compensation paid to an employee after March 12, 2021 and before July 1, 2021. It may also include the Eligible employer's qualified medical plan expenses that are allocable with the wages. A company cannot receive double the benefits from the same wages claimed credits for purposes of the ERC and the PPP forgiveness determination.

Contractors need to consult an expert to determine credit eligibility. There is still confusion over who is eligible for the employee loyalty credit and who doesn't. The IRS released new guidance regarding ERC earlier this week to clarify retroactive changes to the credit for ERC home improvement services 2020 tax year. It also explained how employers who received a Paycheck Protection Program Loan may claim it. With rising inflation and an uncertain market ahead, seeing so many eligible companies miss out on such a valuable resource is disheartening.

Learn More About Aprio's Erc Options

Additional thresholds are included in the CAA that determine which wages an employer can claim the ERTC. Employers with more 100 employees cannot claim credit in 2020 for wages that were paid to employees who were not actively delivering services (e.g., furloughed). This means that for employers with fewer than 100 or 500 employees, a credit may be claimed for all wages paid to employees, regardless of whether the employees were furloughed. A restoration company in Alabama was able to get a refund of $949,000.

"We're still finding every day that construction is a very underutilized market when it comes to incentive tax credits in general," he says. You or your accountant will need to amend the 941 payroll tax form in order to benefit from the credit. The current processing time for the IRS is approximately eight months. However, in recent months this has been reduced to four to six months.

general are not a new thing. He encourages small-business owners and construction contractors to take advantage of the opportunity before funds run dry or the three year claims window closes. The Employee Retention Credit is one of the most important tax benefits available for small and medium businesses, as well as tax-exempt entities. It helps to keep doors open and employees on pay during difficult economic times.