covid19

EXPANDED IN 2021: UNDERSTANDING THE EMPLOYEE RETENTION CREDIT AND THE PPP

by Anthony Campolo, CPA, Partner, CohnReznick’s Construction Practice
 



Anthony Campolo
CPA, Partner
CohnReznick’s Construction Practice

Good news for contractors. As you may know, a new law permits PPP loan recipients to obtain Employee Retention Credits for 2021 as well as 2020. For contractors across the country, most experienced what New York City-based contractors experienced: partial suspension of operations due to governmental orders because of COVID-19. The related relief programs and tax credits like this one all have varying impacts relating to a contractor and taxes.

Under the Consolidated Appropriations Act of 2021, the ERC for 2020 was extended and expanded for the first two quarters of 2021. Consequently, a contractor that did not take an ERC for 2020 because it or its controlled member received a PPP loan may now be eligible for ERCs for 2020. In addition, the Act has significantly liberalized the ERC requirements for 2021.

The article and explanations cover:

  • Eligibility requirements for contractors
  • Amount of ERCs a contractor can receive
  • What counts as “qualified wages”
  • How the ERC and PPP interact
  • Helpful “decision trees” that guide you through 2020 and 2021

Download the full explanation here including the “decision trees.”
https://www.cohnreznick.com/insights/contractors-and-the-employee-retention-credit