Are you a lawyer or law firm looking for financial relief? The Employee Retention Credit (ERC) may help. This tax credit is available to law firms that have seen their gross receipts decline because of the pandemic and provides a refundable tax credit against an employer's payroll taxes. Law firms may be eligible for the ERC if they meet specific criteria outlined below. Our team of ERC specialists are here to help you understand the eligibility requirements and maximize your potential benefit from this ERC tax credit. Keep reading to learn more about what the ERC means for law firms.

What is the Employee Retention Credit (ERC)?

The Employee Retention Credit (ERC) is a refundable tax credit for employers that have faced economic hardship due to the COVID-19 pandemic. It was included as part of the Coronavirus Aid, Relief and Economic Security (CARES) Act in March 2020 and applies to wages paid between March 13th, 2020, and December 31st, 2021. The ERC provides eligible employers with a tax credit against their payroll taxes equal to 50% of qualified wages paid up to $10,000 per employee per calendar quarter.

How Can Law Firms Claim the ERC Tax Credit?

Once our ERC specialists have determined that your law firm is eligible for the credit, our team of CPA ERC specialists will begin preparing your application. It requires specific documents such as your payroll tax return filing history, gross receipts, and qualified wages paid to employees. Additionally, if there are any changes in employee numbers or business operations during the calendar quarter, employers must report this information on their applications.

Law firms have documented their eligibility as employers subject to mandates limiting access to courts. The restrictions include not just court closures, but also court-specific delays in trials with a ban on in-person juries, and government mandates affecting law firm operations in approaching court matters. Contact us today if you have any questions regarding ERC eligibility for your law firm and receive your complimentary ERC refund estimate.