Employee Retention Credit for Law Firms Podcast
February 23, 2021
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The Consolidated Appropriations Act, 2021 (“the Act”) expanded and extended the Employee Retention Credit (“ERC”) provisions making this payroll tax refund available to a broader range of employers. The Act also increased the credit rate from 50% of Qualifying Wages during the year (2020) to 70% of Qualifying Wages in both Q1 and Q2 of 2021. Resulting in a maximum refundable payroll tax credit of $5,000 per employee in 2020 and $14,000 per employee in 2021.
The other change that the Act provided was the ability for firms to claim both Paycheck Protection Program (“PPP”) and ERC benefits, as long as both benefits are not related to the same wages. Firms that received PPP funding in 2020 never considered whether they were Eligible Employers for purposes of the ERC due to the prior prohibition of claiming both benefits. Now, many firms are analyzing the government orders affecting court closures and limitations on jury trials to consider whether they experienced a partial shut-down for purposes of the ERC.
Join Jamie Walker, a leader in our Professional Services Industry practice and Martin Karamon, a Principal in the Firm’s Tax Advisory Services practice for a podcast where they discuss the Employee Retention Credit (ERC), how law firms may qualify and what firms must demonstrate in order to claim the credit.