The Employee Retention Tax Credit (ERC) is a refundable tax credit designed to reward business owners for retaining employees throughout the COVID-19 pandemic. The Employee Retention Credit is available to both small- and mid-sized businesses. It was signed into law on March 27, 2020, as part of the CARES Act. The bill was significantly expanded in 2021.
Business owners impacted by COVID-19 can claim up to $5,000 in refundable tax credits for each employee on their payroll in 2020 and up to a $7,000 credit per quarter for each employee in 2021.