We are still finding that many employers and tax professionals are unaware of this credit.  Please forward this information to any small business owners that may be eligible.  The eligibility for this credit is very broad.  In many cases, essential businesses do qualify for it.

The ERTC was initially applicable for 2020 and only the first 2 quarters of 2021.  It has now been extended for the entire 2021 year.  This means you can get a maximum tax credit of $7K per employee per quarter, for a total of $28K per employee for the 2021 calendar year.

The IRS has still not addressed the issue of whether the business owner (shareholder) is eligible for the ERTC.  Some say yes, some say no.  There is some tax law that indicates that a greater than 50% owner would not be eligible, while a 50% or less owner would be.  The safest thing, absent any further IRS guidance, would be to report your spouse as 50% owner of the business (where applicable).  Since this application of ERTC is without precedent, it is not clear what we should rely on.  My position is that an employee is an employee, regardless of shareholder status.  We covered this in further detail in our update on 2-16-2021. We have been submitting the Form 7200 for several small business clients, but have not gotten feedback on the turnaround time for the payments.