Non-Profits Eligible for ERTC, up to $19,000 per Employee

Posted on March 5, 2021December 18, 2023

The Consolidated Appropriations Act, 2021, signed on December 27^th, 2020, is expanding eligibility for the Employee Retention Tax Credit (ERTC) by allowing those who received Paycheck Protection Program (PPP) loans to qualify. Prior to December 27, 2020, PPP loan recipients could not also file for eligible tax credits.

For nonprofits, the ERTC is taken against payroll taxes on the quarterly Form 941. If qualifications for the ERTC are met, an amended 941 may be filed for the applicable quarter. The ERTC is available for calendar year 2020 and potential benefits are up to $5,000 per employee per year (up to the first $10,000 paid). The ERTC is also available from January 1, 2021 through June 30, 2021 with potential benefits of up to $7,000 per calendar quarter (up to the first $10,000 paid per quarter). The total potential value of the 2020 and 2021 ERTC is up to $19,000 per employee.

How Do You Qualify?

If gross receipts meet certain reduction criteria OR your business was fully or partially suspended by a COVID-19 government order, you may qualify. Details related to eligibility are outlined in a previous blog: https://www.aafcpa.com/2021/01/04/employee-retention-credit-updates-expanded-eligibility/.

If you have questions, please contact Nichole Reilly, CPA, MBA, at nreilly@nullaafcpa.com, 774.512.4016, Courtney McFarland, CPA, MSA, at 774.512.4051, cmcfarland@nullaafcpa.com; or your AAFCPAs Partner.

About the Authors

Courtney McFarland, CPA, MSA, 340B ACE

Courtney is an audit & consulting partner in the firm’s Healthcare Practice with extensive experience advising the nation's healthcare safety net community, including Federally Qualified Heath Centers (FQHCs), clinics, and behavioral health providers. She delivers a full range of solutions solving the challenges that AAFCPAs’ healthcare clients face, including: audits in accordance with Uniform Guidance/Single Audit and Government Auditing Standards, 340B pharmacy program requirements, best practices for reconciliation & analysis of statistical and programmatic data, …

Nichole A. Reilly, CPA, MBA

Nichole is a leader in AAFCPAs’ Education Practice, where she specializes in advising charter schools, private schools, and other education-related nonprofits. She fully understands the nuances of the education industry and its business and operational challenges, including funding opportunities and regulatory issues. Nichole also possesses deep expertise in advising arts and cultural organizations, offering specialized guidance that enhances their financial resilience and strategic planning. Nichole’s active involvement with the MA Charter Public School Association showcases her …

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