Undoubtedly COVID-19 has been difficult for us all. When the outside world came to a physical halt, many of us felt like time had stopped too. Though sadly the world kept moving, and we transitioned to the online world wholeheartedly. During the restrictions placed within the country, many faced increased hardships: unemployment rates began to rise drastically, and businesses ceased to function with no customers.
One person who experienced first-hand the difficulties of the restrictions is Myrtha Chang, the owner of the math tutoring business Mathnasium.
“I lost almost 70% of my client base,” Chang reflected on the past several years, “There has never been a quiet season since I started my business, so you can imagine my shock when 2020 came around. I was terrified, in all honestly, I thought this business I had worked so hard on was about to fall apart and there was nothing I could do to save it. We made the adjustments to online teaching rather quickly, but with remote learning for kids, parents saw no need to continue paying for tutoring.”
While facing these unexpected financial hardships, businesses of all sizes faced the tough decision of what to do with their staff. Many corporate level businesses had a little issue keeping their workforce and continued to pay them their full wages. However, smaller businesses like Mathnasium were put at a much bigger detriment for the same choice, and many decided it would be best to reduce their workers. In these times, there truly was no right or wrong answer.
Chang decided to continue paying her full team of tutors their entitled wage, despite how little work there was for them.
“This was the ideal decision in my mind. In the hopes that my business would survive this difficult time, I would need my tutors. They are good and hardworking people, they’re invaluable. If I let them go early on, and Mathnasium began to pick up again as kids get back to school, then I would have to invest what little finances I had left into hiring and training new tutors. That seemed more damaging in my mind.”
Chang wasn’t willing to give up so easily, with support from her loved ones, she reached out to ERC Benefits to discuss what options she had.
Luckily for Chang, she was a prime candidate for the Employee Retention Credit. This credit applies to businesses that decided to keep their workforce throughout the COVID-19 restrictions and closures. For those who continued to pay their workers in full could be entitled up a credit of 50% of wages for 2020, and up to 70% per quarter of 2021.
The Chief Revenue Officer at ERC Benefits states:
“When people hear the IRS is involved, they are immediately discouraged. They assume the ERC is a headache to apply for and don’t even want to try. That’s where ERC Benefits come in. We want to show business owners that the ERC is not as difficult as they might think and help them see that they most likely do qualify. The conditions for the ERC are straightforward. All the business would need to do is provide proof that they have maintained the same number of workers throughout the pandemic and continued paying them. Furthermore, you will need to show you have had a significant loss of earnings throughout this time, about 20% at the minimum.”
ERC doesn’t only apply to established businesses, new businesses created in 2020 can also be eligible. They would just need to use their yearly forecasted revenue as proof of a significant loss in earnings, rather than previous bank statements.
Chang was amazed at how much she was credited.
“This saved my business. Without it, I don’t know where I would be. Now I have the confidence to persevere and keep working hard.”
Although COVID-19 restrictions are long in the past, businesses are still able to claim ERC until the end of 2023 if they are still suffering from the events. Contact ERC Benefits on 561 680 4677 or visit ercbenefit.com today to see if you’re able to claim ERC, or to get any guidance you may need.