Why Restaurants and Retail Shops Should Still Apply for the Employee Retention Credit (ERC)
In the aftermath of unprecedented challenges, restaurants and retail shops are looking for ways to stabilize and grow. One critical lifeline not to be overlooked is the Employee Retention Credit (ERC). Here’s why your business should consider applying if you haven’t already.
Cash Injection When It Counts
The ERC offers substantial tax credits for qualified wages paid to employees, providing a cash infusion that can be pivotal for businesses operating on razor-thin margins. This is not a loan; it’s a credit, meaning it doesn’t have to be repaid. For many, it can be the difference between staying afloat or not.
Offset COVID-19 Impacts
Many restaurants and retail stores continue to face the operational impacts of COVID-19. The ERC is specifically designed to offset these challenges, rewarding businesses that have retained their staff during hard times.
The rules for ERC are specific, but the path to eligibility caters to a wide array of situations that might have impacted your business. Whether it was a full or partial suspension of operations due to government orders or a significant decline in gross receipts, the chances are that your restaurant or shop qualifies for some level of credit.
Retroactive Claims for Relief
Even if your business is back to pre-pandemic levels of operation, the ERC is claimed retroactively on amended payroll tax forms. If you didn’t take full advantage of the credit during eligible quarters, it’s not too late to claim what you are owed. The credit for 2020 will be expiring in April 2024, so now is the perfect time to file a claim.
Support for Future Resilience
Beyond providing immediate financial relief, the ERC can strengthen your business’s long-term resilience. While ERC funds can be used for anything, if used to offset your payroll, it can help maintain a loyal and experienced workforce, ready to help your business grow.
While the worst of the pandemic may be behind us, the economic impact lingers. The ERC is a valuable opportunity for restaurants and retail shops to regain their footing and push forward. Don’t leave this money on the table – it could be the support your business needs to thrive in the coming year.
Until next time,
The Figure Financial Team