ERC for Gyms and Fitness Centers
Gyms and fitness centers have the opportunity to access cash relief through the Employee Retention Credit (ERC)
Gyms and fitness centers are prominent candidates for ERC because of three factors. Firstly, they had to either fully or partially shut down during the start of the pandemic. Secondly, they were compelled to decrease their member capacity to observe social distancing rules. Lastly, gyms and fitness centers experienced substantial revenue losses in 2020 and 2021, primarily due to the previously mentioned reasons, but also from membership cancellations. Additionally, customers' fear of pandemic safety often leads to a reluctance to use the gym, further contributing to the loss of revenue.
The Employee Retention Credit (ERC) presents a significant opportunity for relief to businesses affected by the COVID-19 pandemic, with the potential for up to $26,000 per employee during the years 2020 and 2021. Eligibility for the ERC can be determined by actual closures, restrictions imposed by government orders, or by demonstrating a reduction in gross receipts of 50% or a 20% decline in gross receipts for specific quarters in 2020 and 2021, compared to the same quarters in 2019. It is important to note that the ERC can still be accessed even if a business has already received PPP loans, and newly established businesses after February 2020 may qualify for up to $100,000 in refundable credits in 2021 under specific ERC provisions.
While it's unclear if Congress will extend other pandemic relief for gyms and fitness centers, the ERC remains available now. The government restrictions have impacted various business operations in the transporation industry and you could be one of the many employers entitled to significant cash benefits. Don't miss out on the opportunity to see if your business qualifies for the ERC. Contact us today!
Click here to learn more about ERC for gyms and fitness centers.
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