05/26/2023
How can Small Businesses Apply for the ERC Program
To claim the ERC, small businesses must first determine the amount of the credit they’re eligible for. This is done by calculating the amount of qualified wages paid to employees during the pandemic.
Qualified wages include:
Wages paid to employees who were not working due to a government order related to COVID-19.
Wages paid to employees who were working during the pandemic but whose hours were reduced due to the pandemic.
Wages paid to employees who were not working during the pandemic but still receiving health benefits.
Once the amount of qualified wages has been calculated, the small business can calculate the amount of credit they’re eligible for. The credit equals 50% of the qualified wages paid to each employee, up to a maximum of $26,000 per employee.
Small businesses can apply for the ERC by completing Form 941-X, the Employer’s Quarterly Federal Tax Return.