ERC - Are You Missing Out?

The Employee Retention Credit (ERC) is a tax credit - designed to help small businesses, including churches, schools, and non-profit organizations, recover from the impacts of COVID-19. Recent research has found that while many churches and organizations took advantage of the government's PPP (Paycheck Protection Program), most do not know about the ERC or think they are not eligible.

In this information session, Generis and CapinCrouse discuss eligibility for the ERC and clarity around what funds are available and how you can easily access them.

The CARES Act's Employee Retention Credit is a fully refundable tax credit. For the 2020 program, the ERC is equal to 50% of qualified wages (including allocable qualified health plan expenses) that eligible employers pay their employees. This applies to wages paid after 3/12/2020 and before 1/1/2021. The maximum amount of wages taken into account with respect to each employee for all calendar quarters is $10,000, so that the maximum credit for an employee is $5,000.

For the 2021 program, the credit is increased to 70%, and the limit is $10,000 per quarter. This means the annual maximum for an employee is $28,000..

Eligible Employers for the purposes of the Employee Retention Credit are those that carry on a trade or business during calendar years 2020/2021, including a tax-exempt organization, that either:

Fully or partially suspends operations by a governmental order, or
Experiences a significant decline in gross receipts during a calendar quarter when compared to 2019

The Employee Retention Credit is accessed by filing a 941-X Amended Quarterly Payroll Tax return. The IRS will accept these for up to three years after the initial filing, so the ability to participate in ERC program may continue into the end of 2024.

There are many factors that go into the calculation and a thorough assessment should be completed. Recent churches we've worked with have encountered significant returns.

Here are some sample calculations:

8 employees (6 eligible) = $30,000 + $42,000 = $72,000

15 employees (11 eligible) = $55,000 + $77,000 = $132,000

25 employees (20 eligible) = $100,000 + $140,000 = $240,000

About Generis

Regardless of your ministry’s size and scope, there is almost always a gap between your resources and your God-inspired vision. Generis exists to help close that gap by partnering with leaders to develop a thriving culture of generosity in their church—a culture that is discipleship driven, biblically rooted, inspires mission impact, and funds your God-inspired vision for years to come. By taking biblical principles, best practices, and 30 years of experience plus your church’s unique culture and DNA, we build a plan that will begin accelerating generosity in your church.

About CapinCrouse

Changed lives through revolutionary service.

At CapinCrouse, we have one focus: serving organizations whose outcomes are measured in lives changed. It’s the foundation our firm was established on, and the driving force behind all that we do.

As a national CPA and consulting services firm, we have served mission-focused not-for-profit organizations, churches, and higher education institutions since 1972 by providing support in the key areas of financial integrity and security.

This is more than a market niche for us; it is our primary focus and our mission.