Insights

Employee Retention Credit (ERC) - Get up to $26,000 per employee. 

Introduced in the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), the Employee Retention Credit was created by Congress to encourage employers to keep their employees on the payroll during the months in 2020 affected by the coronavirus pandemic.

When initially introduced, this tax credit was worth 50% of qualified employee wages but limited to $10,000 for any one employee, granting a maximum credit of $5,000 for wages paid from March 13, 2020, to December 31, 2021. It has since been updated, increasing the percentage of qualified wages to 70% for 2021. The per employee wage limit was increased from $10,000 per year to $10,000 per quarter.

The credit is available to all eligible employers of any size that paid qualified wages to their employees, however different rules apply to employers with under 100 employees and under 500 employees for certain portions of 2020 and 2021.