Welcome to the Internet's Only ERTC Self-Qualification Tool
Thank you for checking out this ERTC Pre-Qualification Tool we developed for Guidant Financial.
Our objective is to walk you through the eligibility criteria for these significant tax credits, but without the pressure that you might feel on a phone call.
Don't get me wrong. We are certainly available for a phone call. Indeed, as a registered CPA Firm, we require a phone call prior to accepting a client (as part of our Firm's Client Acceptance Risk Management Policy).
However, I am happy to also provide this tool that will explain both the objective and subjective qualifying criteria . . . we're going to tell you if and when you automatically qualify . . . and if the math doesn't work, I will explain the other qualification criteria that we apply to your situation.
Make no mistake - as a registered CPA Firm who specializes in the Employee Retention Credits, JWC ERTC Advisory CPA is your Safe Harbor through our conservative, fiduciary approach to tax positions and our impeccable reputation with the Internal Revenue Service.
It was these shared ideals for fiduciary-level client care that brought us together with Guidant Finance, and I am incredibly honored for the trust that has been placed in our Firm.
Now that we've set the stage - let's jump into your eligibility assessment . . ."
ERTC Self-Qualification Tool
Quick Explanation of Determination
Businesses with less than 500 full time employees can qualify for Employee Retention Credits by meeting one of two criteria:
- Either experiencing declines in revenue in 2020 or 2021 when comparing to 2019 (certain thresholds must be met by quarter) or
- Experiencing a full or partial suspension of operations due to governmental orders.
Also, if your business began operations after Februrary 15, 2020, then you automatically qualify for these credits in Q3 and Q4 of 2021 and there is no other criteria required (meaning you didn't have to suffer a decline in revenue or shutdown due to mandates).
You should also know that wages paid to the majority owner and any relatives is not eligible for these credits. We know there are ERTC experts telling people they must have 5 W-2 employees, and that simply is not true. These companies just don't want to deal with small clients.
When a new client comes to our CPA Firm, we always begin by gathering their revenue for each quarter of 2019, 2020 and 2021 . . . and then we apply the math to calculate the percentage declines.
This calculation of the decline in revenue is our first choice because it's objective. The math doesn’t lie. The IRS could ask you to prove the amount of revenue you are reporting to us for each quarter (for the calculation), but that’s the extent of their review of your eligibility.
If you don’t qualify for all six quarters of the ERC program based on a decline in revenue, then we next consider how your business was impacted by governmental orders. This is where the subjectivity prescribed by the IRS can become very complex and why it is particularly important for you to work with a registered CPA Firm who can practice before the IRS.
So here’s how we’ll do this . . .
On the next page, you’ll enter your revenue for each quarter of 2019, 2020 and 2021 . . .
We’ll execute the math and tell you, definitively, which quarters you will automatically qualify - no subjective judgment required.
Depending on what you learn, you can choose your own adventure from there . . .
Ready to get started?
ERTC Self-Qualification Tool
What all revenue should I include?
The IRS terms this as "Gross Receipts", but we will call it revenue since this is the term used by 99.9% of for-profit business. This will include total sales (net of returns and allowances) and all other amounts received for services. In addition, you should include any income from investments, and from incidental or outside sources.
It is important here that you enter your quarterly revenue based on whichever method (cash / accrual) that you file your income tax return.
We know that most small businesses don't maintain quarterly P&L's, so our cash basis clients will add the deposits from monthly bank statements to determine their quarterly gross revenue.
Enter Quarterly Gross Revenue
New Businesses
If your business started after January 1, 2019, please enter 0 into the "Revenue" fields for any
quarters where you were not in business yet. This allows us to appropriately adjust our calculations
based on IRS guidance for new businesses.
Congratulations!
You automatically qualify for Employee Retention Credits because your operations were partially suspended due to governmental orders (indoor dining restrictions).
For any other industry we would have several paths from here . . . we may need to assess additional government mandates or go back to gather your gross revenue for every quarter of 2019, 2020 and 2021.
But not for you - instead, we're ready to invite you to Schedule a Guidant Financial Restaurant Client ERTC Discovery Call.
How Much Refund Should You Expect?
We have developed a really accurate ERTC Calculator; however, we have discovered over the past two years that it is not very accurate for our restaurant clients.
And for restaurants, our estimation is not very precise because EVERY restaurant in America with indoor dining will qualify for ERTC. However, every state/city had different dates for their indoor dining restrictions.
The reason why our calculator is not more precise is because we can only programmatically estimate your refunds for those quarters where you qualified due to a decline in revenue from 2019. But that isn't good enough for you.
Since you will qualify for the entire time that your indoor dining was at reduced capacity, then this qualifying period varies too much for us to bake into one calculator.
For example, restaurants in Florida were back to full capacity by September 2020, but restaurants in New York were not full capacity until June 2021.
Additionally, the credits are capped per W-2 employee . . . but many part-time employees or high staff turnover can skew the results of our calculator.
And lastly, a fast food restaurant has a different mix of compensation levels among staff, compared to a fast casual or fine dining. These varying levels of compensation add one more element of unpredictability that we are unable to capture in a one-size-fits-all calculator.
For the reasons above, I would again invite you to Schedule a Guidant Financial Restaurant Client ERTC Discovery Call with our Onboarding Team.
The purpose of this call is to learn a bit more about your business – the ownership structure, number of employees, any affiliated businesses – answer any questions that you have about ERTC and explain how our Firm has streamlined this process to require less than 15 minutes of your time from start to finish.
This Kickoff Call is not a sales call.
Let me be very clear . . . this is NOT a sales call.
Our Onboarding Team does not have commissioned salespeople. Their job is to answer your questions and ensure you get the level of service that you expect from a referral of Guidant Financial.
Guidant has pre-negotiated a flat fee rate of 15% for all of their clients, with no deposit or upfront payment. We invoice you when you receive your refund check (which is currently taking the IRS 3-4 months for most clients).
In Conclusion
We know you have many choices when selecting a ERC firm and I thank you for choosing our website as your trusted ERTC resource.
I know we shared a lot of information here, but we’ve learned as a Firm, that the best clients are the most well-informed clients.
I would like to personally thank you for investing your time with us today. Whether you choose to work with us or not, you are now better prepared to make an informed decision.
And, of course, I hope we have earned the opportunity to assist you in recovering these refunds.
Sincerely,
Jace W Campbell
Founder, JWC ERTC Advisory CPA LLC
I’m sorry, we’re not quite there . . .
Based on your Quarterly Revenue inputs, we are unable to automatically qualify you for these Employee Retention Credits. But wait, this is only the first or two criteria.
Revenue is always our first path because it is objective, math-based. However, this is an “either / or” situation.
You may still qualify based on the more subjective criteria described by the Internal Revenue Service as a “full or partial suspension of operations”.
The nuance of this criterion has created a cottage industry of ERTC “experts” encouraging clients to “check a box” and collect a refund check.
It’s dangerous. Irresponsible. The position of the IRS is that the taxpayer is always responsible. And as a registered CPA firm, it is our duty to ensure you understand these credits.
The objective of this webpage is to help you move quickly to the next stage in your exploration of ERTC. I see your path from here as one of two options:
- You understand why you may legitimately qualify for these credits (and you are ready to talk with someone to further assess your situation), or;
- You recognize that you do not qualify (in which case you have saved yourself a phone call with us or another firm, or even better, you’ve saved yourself the time and money of erroneously claiming ERC with another firm, only to be hit by the IRS with penalties and interest four years from now).
Critical Need-to-Know’s About ERTC
Below is a video consultation. You might say it’s a Crash Course in ERTC for Business Owners. I intended on making a 10 minute video and it turned into 25 minutes because I get so fired up when explaining these credits.
But I know that even I wouldn’t want to watch a 25 minute video - I would rather skim and read to learn at my own pace.
So below this video I’ve simplified this. Read and skim at your own pace.
If you want to jump straight to a phone call with us, feel free to Schedule a Guidant Financial Discovery Call. At the bottom of this page we talk more about what is involved with that call.
However, if you would rather learn at your own pace prior to jumping on the phone (or to save yourself a phone call), I invite you to explore the topics below.
In March 2021, the IRS released Notice 2021-20 to clarify what was intended by the criterion of a "full or partial suspension of operations".
This is the same guidance that marketing firms are referring to when they still to this day tell you “New IRS Guidance Means You Now Qualify for ERTC”.
This guidance isn’t new - that’s just a marketing gimmick.
But the content of the Notice is very prescriptive. It tells us in plain English how the IRS intends to interpret this subjective criteria.
If you want to cut through the noise and go straight to the source, you are welcome to go to Page 27 of IRS Notice 2021-20. The FAQ’s may even have an example that fits your business perfectly.
The overarching theme of the guidance is that essential businesses that were not required to close during the pandemic are still considered to be “partially suspended” when:
As you read the examples on the rest of this page, we are answering these two questions:
- What modifications did you make in your business because governmental orders required you to make those modifications?
- For what time period did these modifications result in a more than nominal impact to your operations?
The industries below are ones where we believe you have a solid case for qualifying due to our past client experience.
In fact, you will likely qualify for longer than you might initially expect.
For example, many childcare providers initially tell us they were restricted to serving the children of essential workers for one or two months at the start of the pandemic. But they don’t take into consideration the other required modifications.
Many state licensing agencies required modifications to classroom sizes, teacher-kid ratios, closing entire classrooms and sending teachers home due to close contact with a COVID case, etc.
It differs by state, but we find that many childcares are more than nominally impacted well into 2021.
However, not every business in each industry below will qualify.
Remember, this is a “facts and circumstances” test. Two businesses in the same industry and regulated by the same governmental orders may have been impacted to differing degrees. Only businesses that were more than nominally impacted will qualify.
- Restaurants with indoor dining
- Childcare
- Clinics / Primary Care / Pediatrician / Specialists / Dental
- Assisted Living Facilities
- Last Mile Delivery Contractors
- Dental
- Construction Contractors
- Auto Dealerships
- Collision & Auto Repair Shops
- Manufacturers
- Retail
- Home Healthcare
- Gyms / Fitness / Spa
- Churches
- Homebuilders
- On-site healthcare staffing
- On-site IT support
We discussed the qualifying criteria in the first section, and it really is that simple:
The best way to consider this for your business is generally with examples, so we’re bringing you examples from our own clients.
Restaurants
We’ll start with an easy one. Every restaurant in America with indoor dining was limited in their seating capacity. Once they no longer had a percentage restriction, many still had to space tables 6 feet apart which effectively reduced their capacity from pre-pandemic. Most of these restrictions were at the state level, but some counties and cities implemented their own, more strict, capacity limits.
Pediatrician’s Office
Pediatricians were essential healthcare so they never shutdown. However, many state Departments of Health issued emergency orders for how doctor’s offices had to establish protocols for promoting a safe environment for patients and staff.
These protocols led to closing waiting rooms, deep cleaning requirements between patients which led to less available rooms, closure of rooms for hours if not a full day if a patient tested positive for COVID, etc. The cumulative effects of all the modifications resulted in a reduced capacity to serve patients which resulted in a more than nominal impact.
FedEx Contractors
While this is a very specific niche within shipping/logistics, it highlights an important opportunity. The IRS has said that if a corporation implemented modifications across all their locations/stores, and if those modifications were a result of a governmental order in certain states or due to CDC guidelines, then that would carry the same weight as a Governmental Order, even if the order was not specific to the location of that store.
FedEx modified their process for group meetings, training employees and banning two-person crews (because two people could not socially distance in the same vehicle). These changes greatly reduced the efficiency of their operations. By gathering evidence that the number of package drops per hour was down significantly and that employees had to work overtime, plus vehicles that went down could not be repaired because part manufacturers suspended their operations . . . this cumulatively resulted in a more than nominal impact.
Insurance Agency
We hear from many insurance agencies that they had to work from home.
This is a case where we must consider whether or not working remotely creates a more than nominal impact on the business.
If someone works in an office at a computer with a phone, and clients rarely come in to see them. And in fact all work could be done remotely, even if clients do come in from time to time.
Then we must challenge whether that is truly a more than nominal impact, and usually it is not. The IRS has provided a checklist of items to think through when deciding whether working remotely is a qualifying reason.
Sales Organizations
When companies rely on travel for selling their products and services, there may be a path to qualifying, depending on their facts and circumstances.
If your sales team was unable to travel due to restrictions in jurisdictions that they frequent (such as quarantine requirements coming into New York City), but they were still able to execute comparable work through Zoom calls . . . then that was likely not a more than nominal impact on the company.
However, if your sales team attends 10 trade shows a year, and those trade shows were canceled because of restrictions on mass gatherings in San Diego, Las Vegas, Nashville, Miami, New York City, etc., then you likely have a good case for how those restrictions more than nominally impacted your business.
We would take that one step further, though, and you will need to gather evidence to demonstrate how you determined it was more than nominal.
For example, if acquired 100 new customers in 2019 and 50 of them came from these on-site trade shows, and that number effectively went to 0 in 2020/2021 during the period of restrictions on these tradeshows . . . then you have solid evidence to support your position.
Let's wrap this up . . .
We could share examples for days. And for each example, we could discuss why they could qualify, but also why they may not qualify.
This is exactly why we begin each client engagement with a Discovery Call. Not a sales call, but truly a "Discovery Call".
We're going to explain what happens on this Discovery Call at the bottom of this page, but first . . . this last example brings up an important topic . . . let’s talk about documentation.
We mentioned this earlier and we’ll touch on it again here, checking a box to say you were more than nominally impacted is not sufficient documentation for the IRS.
We see this from many ERC specialty firms who are trying to push through as many files as possible. They ask you to check the boxes for how you were impacted . . . and that’s the extent of their evidence gathering.
(Hint: They are going to rely on this “attestation” by you if you are audited and their contract says it is your responsibility to have this documentation - even though that is never explained to you.)
The IRS requires that you create contemporaneous documentation to support your tax positions. This means the documentation is prepared at the time that you reached your determination . . . not years later after the audit begins.
The objective of your documentation should be to explain these three points:
- What governmental orders required you to modify your operations and for what time period?
- How did you modify your operations?
- And what evidence did you gather to determine the modifications resulted in a more than nominal impact?
Let's Prepare Your Claims
If you would like to discuss your potential qualifications based on the subjective criteria discussed on this page, then I invite you to Schedule a Guidant Financial Discovery Call with our Onboarding Team.
The purpose of this call is to learn a bit more about your business – the ownership structure, number of employees, potential suspensions and/or government required modifications – answer any questions that you have about ERTC.
If we feel there is a more likely than not chance that you can qualify based on how we understand the governmental orders to impact you, then we can explain how we have streamlined this process to require less than 15 minutes of your time from start to finish. (After all, having gone through this Qualification Tool, you've already invested the bulk of your time.)
However, after your Discovery Call, that deterimination of your eligibility is the best educated opinion of our Onboarding Team. The final qualifying dates are ultimately decided by our Legal Team.
This Discovery Call is not a sales call.
Let me be very clear . . . this is NOT a sales call.
The Onboarding Team that you meet with are not commissioned salespeople. Their job is to understand your situation and come to their best conclusion on whether it is worth your time to move forward. We do not want to waste your time if it is clear that you won't qualify. Likewise, we do not want to waste our legal team's time reviewing files that obviously do not qualify.
That is not the level of service you should expect of a CPA Firm nor as a client of Guidant Financial.
Guidant has pre-negotiated a flat fee rate of 15% for all of their clients, with no deposit or upfront payment. We invoice you when you receive your refund check (which is currently taking the IRS 3-4 months for most clients).
In Conclusion
We know you have many choices when selecting a ERC firm and I thank you for choosing our website as your trusted ERTC resource.
I know we shared a lot of information here, but we’ve learned as a Firm, that the best clients are the most well-informed clients.
I would like to personally thank you for investing your time with us today. Whether you choose to work with us or not, you are now better prepared to make an informed decision.
And, of course, I hope we have earned the opportunity to assist you in recovering these refunds.
Sincerely,
Jace W Campbell
Founder, JWC ERTC Advisory CPA LLC