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Employee Retention Tax Credit

Has Anyone Received Employee Retention Tax Credit Refund

The Employee Retention Tax Credit (ERTC) was created as part of the Coronavirus Aid, Relief and Economic Security Act to provide financial relief for businesses struggling due to the COVID-19 pandemic.


The ERTC allows employers to receive a tax credit that is applied against certain employment taxes equal to 50% of qualified wages up to $10,000 per employee, including health plan expenses.

This incentive has been heavily discussed in both business and political circles since its inception, but one question remains: Has anyone actually received an Employee Retention Credit Refund? In this article we will explore what it takes to be eligible for ERTC refunds and how companies can go about claiming them.

First off, it's important to understand who qualifies for ERTC credits. Eligibility criteria are determined by several factors such as whether or not the employer experienced a suspension of operations due to governmental orders related to COVID-19 or if there were significant reductions in gross receipts during a given quarter compared with the same quarter in 2019. Additionally, employers must meet other requirements set out by the Internal Revenue Service (IRS).

Finally, once you determine eligibility for ERTC credits and decide to claim them on your return, it’s time to find out how you can get reimbursed. The IRS offers two methods of reimbursement; either through payroll taxes or via direct deposit into a bank account provided by the taxpayer. Furthermore, taxpayers may also opt for advance payments which allow them to receive their funds more quickly than traditional filing methods.

Definition of Employee Retention Tax Credit

The Employee Retention Tax Credit (ERTC) is an incentive program designed by the US government to help businesses that have been financially affected by the pandemic. It offers a refundable tax credit for employers who retain their employees and continue to pay them during the period of economic hardship caused by COVID-19.

Employers may choose to claim either 50% of qualified wages paid up to $10,000 per employee or 70% of qualified wages paid up to $10,000 per employee. 

The total amount of ERTC available for qualifying employers cannot exceed $5,000,000 in any calendar quarter. To be eligible for this tax credit, employers must meet certain criteria as outlined by the Internal Revenue Service (IRS).

Eligibility Requirements

The Employee Retention Tax Credit (ERTC) is a refundable credit available to employers that have experienced economic hardship due to the COVID-19 pandemic.

To be eligible for ERTC, an employer must meet certain criteria such as having had either a full or partial suspension of business operations during 2020 due to orders from an appropriate governmental authority limiting commerce, travel, or group meetings; experiencing significant decline in gross receipts over any three consecutive months in 2020 compared to 2019; or providing paid leave wages pursuant to the Families First Coronavirus Response Act.

In addition, employers claiming the ERTC must also provide qualified wages and health care costs for their employees. Qualified wages are those paid between March 13th and December 31st of 2020 up to $10,000 per employee on an annual basis.

Health care costs include amounts paid by the employer towards medical coverage regardless if it was provided through insurance premiums or direct payments made by the employer during this period. It should be noted that other eligibility requirements apply depending on whether an employer has less than 100 FTEs or more than 100 FTEs.

It’s important for employers interested in taking advantage of the ERTC to familiarize themselves with all applicable eligibility requirements so they can ensure compliance when filing for the tax credit. After understanding these basic qualifications and determining qualification status, employers will need to learn how best to claim the credit moving forward. Make sure to check the status of your refund process.

How To Claim the Credit

In order to claim the employee retention tax credit, businesses must fill out IRS Form 941-X. This form is used for both amended employment tax returns and for claiming refundable credits related to employment taxes. The employer must provide details about their eligible wages and qualified health plan expenses in order to be considered for the credit.

After submitting Form 941-X, employers can expect to receive a notice from the Internal Revenue Service (IRS) informing them of their eligibility status and the amount of the credit they are entitled to receive. If approved, employers may choose to apply their expected credit toward current payroll taxes or request an advance payment directly from the IRS by filing Form 7200.

The following items are important factors when requesting an advance payment:

  • Eligible wages that were paid after March 12th, 2020, and before January 1st, 2021

  • Qualified health plan expenses incurred between April 1st, 2020 through December 31st, 2021

  • Maximum tax credit limit of $5,000 per employee

  • It is important to note that any unused portion of the employee retention tax credit will not be refunded until the employer files its annual income tax return with IRS Form 941-X attached. For more information on how to file for a refundable credit against your federal employment taxes please consult with a professional tax advisor or refer to IRS Publication 535 - Business Expenses. 

    Additionally, it is highly recommended that all business owners review pertinent publications issued by their state's Department of Revenue regarding applicable laws pertaining to refunds prior local taxes as well.

    What Is Refundable and Non-Refundable

    The Employee Retention Tax Credit (ERTC) is a refundable tax credit that can be claimed against certain employment taxes. This includes the employer's portion of Social Security and Medicare taxes, as well as federal income tax withholding from employees' wages. 

    The ERTC is intended to help businesses cover the costs associated with retaining their workforce during times of economic hardship due to the COVID-19 pandemic.

    In order for an employer to qualify for the ERTC, they must have experienced certain losses in gross receipts compared to previous years or have been forced to partially suspend operations due to government orders related to COVID-19.

    Eligible employers may claim a refundable tax credit equal to 50 percent of qualified wages paid after March 12, 2020 and before January 1, 2021. Qualified wages are generally limited to $10,000 per employee on an annual basis.

    If eligible for the credit, employers may choose either an immediate cash payment or opt for claiming a reduction in payroll taxes when filing quarterly returns. 

    A business owner who chooses the former will need to file Form 7200 Advance Payment Request prior to receiving any funds while those choosing the latter will need to file Forms 941 and 940 along with other relevant documents when making payments each quarter throughout 2021.

    How To File for a Refund

    Filing for a refund can be an intimidating process, but it doesn’t have to be. To maximize your chances of receiving the full amount you are eligible for, here are some tips:

  • Start early and make sure all necessary paperwork is completed correctly. Gather all relevant documents such as receipts or proof of purchase before submitting your claim.

  • If possible, use online filing systems which generally provide more detailed instructions and assistance. This may also help speed up the processing time, allowing you to receive your refund sooner. Although it's not assured, taxpayers who select this option might get their refund sooner. 21 days after submitting your 2022 taxes in 2023, you may get your refund.

  • Reach out to tax professionals who specialize in refunds if needed. They can answer any questions you might have about eligibility requirements or other procedures related to claiming a refund.

  • It is important to note that not everyone will qualify for an employee retention tax credit (ERTC) refund. In order to determine whether or not you are eligible for this type of refund, review IRS guidelines carefully and consult with a professional if needed.

    Additionally, keep track of deadlines so that claims made after the deadline will not be accepted by the IRS. Knowing these rules ahead of time could save you from having to submit multiple applications due to errors or omissions on previous forms.

    With careful planning and preparation, filing for an ERTC refund does not have to be a stressful experience. The key is being informed and organized throughout the entire procedure – both crucial steps towards ensuring success when applying for any kind of returnable funds.

    Tips for Maximizing Your Refund

    The Employee Retention Tax Credit is a valuable benefit for those who have been impacted by the economic hardships caused by COVID-19. To maximize your refund, it’s important to understand the rules and regulations that govern these credits. Here are some tips on how to ensure you receive the maximum amount of money back when filing your taxes:

    First, make sure you know exactly what expenses qualify as eligible for the credit. Generally speaking, qualifying expenses include payroll costs such as wages and health insurance premiums paid to employees during any period in which operations were fully or partially suspended due to coronavirus-related government orders.

    It’s also important to keep track of any other deductions related to employee retention efforts. These can include bonuses given out in appreciation of employees continuing to work despite pandemic conditions, increased salaries offered as an incentive for employees staying with the company during difficult times, and subscription fees for online learning platforms used by employees.

    Second, be aware that there may be certain restrictions associated with claiming this tax credit; understanding them before filing will help you avoid potential pitfalls down the line.

    For instance, employers cannot claim both the wage subsidy provided through Canada Emergency Wage Subsidy (CEWS) program and ERTC at same time for same pay periods - one must choose between either CEWS or ERC when claiming reimbursement payments from CRA .

    Additionally, businesses whose gross revenue has decreased more than 10% year-over-year compared to 2019 are not eligible for reclaiming their full Employee Retention Credit amounts under current legislation – they would only be able to recover half of their original investment if total profit margins drop below 10%. 

    Finally, employers should take note that all claims need to be made within three months after end of fiscal year so don't wait too long!

    By taking into account these guidelines regarding eligibility requirements and timelines ahead of submitting tax returns , employers can rest assured knowing they are getting every penny possible back from their investments in employee retention initiatives over past twelve months.

    The IRS is putting up a lot of effort to handle the backlog of tax returns in the order they were received. They're also doing more to speed up the return and refund processes.

    With careful attention paid to details around credit claiming process , taxpayers can ensure they get most bang for buck while minimizing risk exposure associated with noncompliance penalties issued by Canadian Revenue Agency (CRA).

    Frequently Asked Questions

    Has anyone received ERTC refund?

    Yes, many businesses have received an ERTC refund. However, the processing time for ERTC refunds may vary and some businesses are still waiting for their refund.

    What is ERTC?

    ERTC stands for Employee Retention Credit. It is a tax credit provided by the IRS to businesses impacted by COVID-19.

    How can I check the status of my ERTC refund?

    You can check the status of your ERTC refund on the IRS website or by contacting the IRS directly.

    What is the processing time for ERTC refunds?

    The processing time for ERTC refunds may vary. However, the IRS has said that most businesses should receive their refund within a few weeks of filing their claim for refund.

    How do I file for ERTC?

    To file for ERTC, businesses need to complete Form 941.

    What is the eligibility for ERTC?

    Businesses that have been impacted by COVID-19 may be eligible for ERTC. However, the eligibility criteria may vary depending on the specific circumstances of each business.

    Can the IRS help me get my ERTC refund?

    Yes, if you are having trouble receiving your ERTC refund, the IRS may be able to help you. Contact the IRS to inquire about the status of your refund.

    How long does it take to get an ERTC refund per employee?

    The processing time for ERTC refunds per employee may vary depending on the specific circumstances of each business. However, the IRS has said that most businesses should receive their refund within a few weeks of filing their claim for refund.

    How can I check on the status of my ERTC filing?

    You can check the status of your ERTC filing on the IRS website or by contacting the IRS directly.

    What is the ERTC refund process?

    The ERTC refund process involves completing Form 941 and filing a claim for refund. The IRS will review the claim and issue a refund if the business is eligible.

    What is the current ERTC refund status?

    The current ERTC refund status may vary depending on the specific circumstances of each business. However, many businesses have received their refund while others are still waiting for their refund.


    The Employee Retention Tax Credit is an incentive offered to employers as part of the Coronavirus Aid, Relief, and Economic Security Act (CARES) that allows businesses to retain employees during the pandemic. To be eligible for this credit, employers must have operations partially or fully suspended due to government-mandated closures or a significant decline in gross receipts. The amount of the credit varies depending on whether it's a qualified wage payment or health plan coverage expense.

    Claiming the credit includes filing IRS Form 941 with your quarterly tax returns and documenting any related expenses such as wages paid and health care costs incurred by your business. Generally speaking, only qualified wage payments are refundable while non-qualified payments are not; however, both can get you access to the employee retention tax credit if they meet certain requirements. When filing for a refund, make sure you include all relevant information including proof of employment and eligibility criteria such as dates worked and payroll records.

    Finally, there are several tips to maximize your refund when claiming this particular tax credit. Make sure you understand what qualifies as a qualified wage payment so that you can properly document them on your return form. Additionally, take advantage of other credits available under CARES like those for paid family leave and self-employment taxes which may reduce your overall taxable income even further. By staying up-to-date with new regulations from the Internal Revenue Service (IRS), taxpayers can ensure they receive their maximum possible ERC refund each year without missing out on important deductions or credits.