If you own a medspa or aesthetic medical practice, you may be wondering if you’re eligible for the Employee Recovery Credit (ERC). The ERC is a refundable tax credit that benefits businesses that kept employees on the payroll during the COVID-19 pandemic.
Learn more: ‘What to Know About the Employee Retention Credit’ – The Hartford
Many medspas were forced to temporarily shut down in the spring of 2020. Employers may be eligible for the ERC credit if they operated a business during calendar year 2020 and experienced either:
- 1. the full or partial suspension of the operation of their trade or business during any calendar quarter because of governmental orders limiting commerce, travel or group meetings due to COVID-19, or
- 2. a significant decline in gross receipts.
Unsure if your business is eligible? “Only 4% of small business owners said they are very familiar with the program. Another 32% said they are somewhat familiar,” says the National Federation of Independent Business in an article titled, “Here’s How Your Business Can Take Advantage of a Generous Tax Refund.”
Learn more: Employee Retention Credit – IRS