The COVID-19 pandemic unleashed unprecedented challenges across various sectors, and the restaurant industry was one of the hardest hit. As government restrictions brought the hospitality world to a standstill, the restaurant landscape underwent a dramatic transformation. In response to this crisis, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) introduced a lifeline for struggling restaurants: the Employee Retention Credit (ERC). This fully refundable tax credit has proven to be a critical tool for restaurants, offering relief during these tumultuous times, and it is still available qualifying restaurants in 2023.
Understanding the Employee Retention Credit (ERC)
The ERC is more than just another government program; it’s a lifeline for restaurants reeling from the pandemic’s economic aftershocks. Born from the CARES Act, the ERC is a fully refundable tax credit designed to aid businesses and organizations that have continued to pay wages amid partial or complete government shutdowns or significant revenue declines in 2020 and 2021. It’s a distinct entity from the Paycheck Protection Program (PPP), a relief initiative many restaurants pursued. What sets the ERC apart is its potential: for restaurants, the ERC can yield three to seven times more funds compared to PPP benefits.
Click here to see if you business qualifies.
Key Insights About the ERC
To understand how the ERC can be harnessed effectively, here are three key takeaways:
- Time Frame and Eligibility: The ERC’s reach spans six quarters, encompassing the final three quarters of 2020 and the first three quarters of 2021. Restaurants can apply for the ERC across all six quarters to maximize their potential benefits.
- Maximum Benefit Per Employee: ERC funds are calculated based on wages paid during the eligible period. Notably, there is a cap of $26,000 per employee for the entire six-quarter period, providing an opportunity for restaurants to gauge their potential benefit.
- Active Application Requirement: Unlike automatic benefits, restaurants must actively apply for the ERC. This application process is a pivotal step in securing the refund, ensuring that the benefits are not missed.
Qualifying for the ERC
The emergence of the COVID-19 pandemic transformed the restaurant sector overnight. With swift government mandates pushing restaurants into take-out only or complete shutdowns, the industry faced unprecedented challenges. The National Restaurant Association’s report underscores that a full recovery to pre-pandemic levels is elusive for many establishments. Shockingly, the National Library of Medicine’s study found that 15 percent of U.S. restaurants closed their doors due to the pandemic’s impact.
With a team experienced in assisting restaurants nationwide, ERC Guaranteed, a dedicated organization focused on maximizing the potential of the ERC for restaurants, hotels and other hospitality businesses, in particular, has become a beacon of support for those seeking to navigate the complexities of the ERC application process. Whether you’re a restaurant owner grappling with the intricacies of the ERC or a manager seeking comprehensive insights,
ERC Guaranteed stands ready to offer assistance. ERC Guaranteed recognizes the universal impact of the pandemic on restaurants. Consequently, they have accessed federal, state, and municipal government shutdown orders, providing vital documentation for restaurants aiming to qualify for the ERC. From capacity limitations to supply chain disruptions, these orders underscore the undeniable link between government mandates and the challenges restaurants faced.
Seizing the Opportunity for 2020 and 2021
It’s not too late even in 2023 to tap into the benefits of the ERC for 2020 and 2021. Restaurants can still file for an ERC refund, even if they’ve already submitted tax forms for these years. The law allows for a three-year lookback period for the ERC, offering an extended window to avail of these benefits. Through expert guidance, like that offered by Sunrise Business Solutions, restaurants can amend their 941-X forms and unlock the potential of the ERC for both years.
The Value of ERC Specialists at ERC Guaranteed
ERC Guaranteed stands as a trusted partner for businesses seeking the maximum benefits from the ERC. Their exclusive focus on the ERC empowers them to provide expert insights to their clients, particularly in the restaurant sector. Their comprehensive services cover every facet of the ERC application process, ensuring businesses secure their rightful refunds. From meticulous analysis to facilitating payments, their team is committed to supporting restaurants throughout the United States in their path to recovery.
As the restaurant industry grapples with the ongoing effects of the pandemic, the Employee Retention Credit remains a beacon of hope. ERC Guaranteed’s commitment to unlocking the full potential of the ERC ensures that restaurants can weather these challenging times and emerge stronger than before. If you’re seeking to secure the maximum ERC benefits, reach out to ERC Guaranteed today, and take the first step toward financial recovery.
Click here to see if you business qualifies.
Disclosure: ERC Guaranteed is an affiliate marketing partner. This post contains affiliate links, which means that Restaurant Technology News receives a commission if you utilize this partner solution.