Can A Single-Member LLC Claim the ERC? 

 October 9, 2023

By  Jace W Campbell, CPA

Can A Single-Member LLC Claim the ERC

The Employee Retention Tax Credit or ERTC, is a credit program designed by the government to incentivize businesses to retain their employees during periods of economic difficulty… such as the pandemic we’re currently facing. It’s a complex program with many facets… some might even say it can be somewhat dull and tedious to navigate through… but in essence, it’s a potentially valuable lifeline for businesses during these challenging times.

How does one qualify for the ERTC?

One of the key questions business owners ask about this program is ‘how does one qualify for the ERTC?’ Qualification criteria can vary depending on a number of factors… but essentially, businesses need to demonstrate that they have been adversely affected by government orders resulting in full or partial suspension of their operations… or they’ve experienced significant decline in gross receipts compared to 2019.

Also read: Employee Retention Credit Deadline 2023

Is a Single-Member LLC eligible for Employee Retention Credits?

Now let’s address our primary question: Is a single-member LLC eligible for Employee Retention Credits? The simple answer is yes. The structure of your business, whether an LLC, LLP, sole proprietorship or corporation, doesn’t influence eligibility. It doesn’t matter if you are considered a disregarded entity with tax liabilities flowing through to your personal tax returns or if your business pays taxes directly…eligibility extends across all these configurations.

Are wages for the owner of an LLC eligible for ERTC’s?

But what about wages paid to an owner of an LLC? Are those eligible too? Unfortunately not. Even if you are paid as a W-2 employee and your company contributes to payroll taxes, any wages paid out to majority owners or any relatives working in the business have been explicitly ruled ineligible by the IRS.

Beware of Deceptive Practices

As you continue your journey to understanding and potentially leveraging the ERTC, beware of firms using deceptive practices to entice you. Remember, ultimately, you are responsible for these tax credit claims…and no so-called ERTC “expert” can change that fact.

Also read: Are These ERTC Cold Calls Just a Scam?

Why Choose JWC ERTC Advisory CPA?

Amidst the confusion and complexity of navigating tax credits, it’s imperative to have a reliable partner by your side. This is where the expertise and experience of JWC ERTC Advisory CPA comes in. Not only do we offer an independent eligibility review for taxpayers who have previously filed for ERTC but are skeptical about their eligibility, but we also stand as a bulwark against fear and uncertainty while maximizing potential gains. We strive to provide a service that is distinct from other ERC firms, offering our clients peace of mind during these uncertain times.

In conclusion… whether you’re an experienced CPA looking to serve your clients better or a business owner trying to understand if your single-member LLC is eligible for the Employee Retention Credit… remember that expert help is available. While the journey might seem daunting, with  the right guidance and advice, navigating through it becomes significantly less intimidating.

Jace W Campbell, CPA

Jace founded JWC ERTC Advisory CPA in March 2021 as the nation's first and only public accounting firm focused solely on ERC . . . and nothing else. He has personally signed over 9,000 ERTC claims and is proud to be executing these claims conservatively, and how intended by Congress.

He has a passion for educating clients so they can make the best decision for themselves.  If you read articles and watch videos that Jace produced in 2021, his approach is the same now as it was then.

While other firms pivot their messaging to comply with new IRS guidance, Jace continues preaching the same conservative principles that have helped clients recover hundreds of millions . . . while sleeping easy at night.

related posts:

Can You Claim Employee Retention Credit in 2023?

Can You Claim the Employee Retention Credit in 2022?

Employee Retention Credit Scams: What You Need to Know

Easy to Start. Even Easier to Finish.

The tax code is complicated enough for CPA's - no need to complicate this process for you as well. That's why we've created The 15 Minute Refund™.

Simply register here and we'll provide your team access to your online portal where documents can be uploaded.

We're not kidding when we say this will take less than 15 minutes of your time.

We'll get you all the deets and the engagement letter to your inbox so we can start immediately.

Register Now