Tax Credits Offer Lifeline to Small Businesses

Tax benefits included in the 2020 CARES Act allow small businesses to claim $26,000 per employee that was impacted by COVID-19 in 2020 and 2021.

Even though the omicron variant of COVID-19 appears to be retreating throughout the United States, small businesses, including several SMACNA members, are still working through several pandemic-related financial challenges. However, several pieces of legislation passed over the last couple of years provide companies with access to funds that could serve as a vital short-term lifeline. One such avenue is the Employee Retention Tax Credits (ERC), a provision inserted into the CARES Act of 2020.

Under the ERC program, businesses can qualify for up to $26,000 per W-2 worker ($5,000 in 2020 and $21,000 in 2021) on their payroll in 2020 and/or 2021. If a business can prove COVID negatively impacted them, they can become eligible for some, if not all, benefits under the ERC program. If any of your chapter members are interested in taking advantage of this program, they should begin to do so as soon as possible. The federal government is slowly starting to sunset this initiative. As with any tax-related matters, please have your chapter members consult a tax professional if they have any specific questions regarding this program or their company’s eligibility.

To learn more about the ERC program, please click here.