Paycheck Protection Program money had helped a small truck services company continue operating in the pandemic and retain their 43 employees. But business through 2020 and 2021 remained very slow, and management was now facing some difficult options. Then they were advised to look into the Employee Retention Tax Credit (ERTC), and that's where they found business salvation.

The ERTC, passed early in the pandemic and repeatedly amended, holds that, if a business with under 500 employees suffered revenue losses of more than 50 percent between 2019 and 2020, that business was eligible for a $5,000 tax credit per employee. And, since that was hard for most businesses to qualify for, in December of 2020 as part of the Cares Act, this was further amended. Now, if revenue for the first three quarters of 2021 was 20 percent less than those quarters in 2020, a qualifying firm is eligible for up to a $7,000 credit per employee per quarter. Potentially, a business suffering covid losses was eligible for a credit per employee of $26,000.

For this small truck servicing company, ERTC delivered a tax credit of over $1 million.

“This isn't generally understood,” notes Dave Toeben, president of Insight Insurance Services. “It's a government program, and when was the last time a government program was understandable?”

Toeben adds that ERTC can be a lot more complicated and even more rewarding than it was for this truck servicer. A company with fewer than 500 employees may have multiple locations in different areas and states. Some of these locations might have been totally shut down, like restaurants in California. Others may have remained open and busy. But the entire company may well be eligible for ERTC.

“It's complicated, but I've seen a lot of seven-figure tax credits,” Toeben says. “I've also seen a lot of shenanigans, pop-up vendors trying to play into this market.”

He adds that there are many “myths” confusing the picture, such as being ineligible for credits if the company received PPP money. “That was true when the bill was passed in 2020, but it was amended in 2021. Now you are still eligible even if you received PPP.”

Insight Insurance does not offer ERTC consulting but does invite phone calls for the complimentary advice.

“The process takes 15 to 20 minutes,” he explains. “We ask a battery of questions designed to make an initial calculation of qualification. If approval seems likely they refer callers to a partner where questions are asked that would disqualify an applicant. “We don't want to waste anyone's time,” he says.

Toeben expanded on his ideas and advice in an upcoming webinar presented by Highako University. Highako by Highradius is the world's first career growth platform for order-to-cash professionals, offering resources needed to develop new skills and to increase productivity and professional career development. 

Contact Information

Dave Toeben

Phone: 615-636-1105

LinkedIn: https://www.linkedin.com/in/davetoeben/

Email: dave@look2insight.com