ERC Assessments

How To Fill Out ERC Forms: A Simplified Guide For Businesses

Jul 19, 2023

Introduction

Businesses that have received funds from the Employee Retention Credit (ERC) need to fill out specific forms to claim the credit. However, filling out these forms can be a daunting task for business owners who are not familiar with the process. This simplified guide will help businesses understand how to fill out ERC forms.


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What is the Employee Retention Credit?

The Employee Retention Credit is a refundable tax credit that was introduced as part of the CARES Act in March 2020. It provides financial relief to businesses that were affected by the COVID-19 pandemic. The credit is available to eligible employers who retained employees during the pandemic.

employee retention credit

Eligibility Requirements

Before filling out ERC forms, businesses need to ensure that they are eligible for the credit. To be eligible, a business must have:

  • Operated during the 2020 or 2021 calendar year
  • Experienced a full or partial suspension of operations due to a government order related to COVID-19
  • Experienced a significant decline in gross receipts
business operations

Filling Out Form 941

Form 941 is the employer's quarterly tax return form. Businesses need to fill out this form to claim the ERC. To fill out this form, businesses need to:

  1. Enter their business details
  2. Enter their tax period
  3. Enter their tax liability for the quarter
  4. Enter their total deposits for the quarter
  5. Enter the amount of the ERC
form 941

Filling Out Form 7200

Form 7200 is the form that businesses need to fill out to claim an advance payment of the ERC. To fill out this form, businesses need to:

  1. Enter their business details
  2. Enter their total number of employees
  3. Enter the anticipated amount of the ERC
  4. Enter the amount of the advance payment requested
form 7200

Conclusion

Filling out ERC forms can be a complicated process, but it is necessary to claim the credit. Businesses that are unsure about how to fill out these forms should consult with a tax professional. By following this simplified guide, businesses can ensure that they are filling out the forms correctly and claiming the full amount of the credit.

If it sounds like a lot, it is. Advisors are available if you need some help with your ERC forms. 

tax forms