Are Hotels Eligible for Employee Retention Credit (ERC)?

Key Takeaways

• Many hotels are eligible for the Employee Retention Credit (ERC), a tax relief measure designed to help businesses retain staff during tough economic times.

• Eligibility for ERC is not automatically granted; hotels must meet specific criteria related to financial impact and employee wages.

• There are misconceptions about ERC that can prevent hotels from applying, such as the belief that PPP loan recipients are ineligible.

• Expert guidance, such as that we provided in ERTC Express, can assist hotels in navigating the application process and maximizing their benefits.

• Understanding common pitfalls and frequently asked questions can help hotel owners confidently apply for and receive their ERC refunds.

Are Hotels Eligible for ERC Refund

Yes, hotels are indeed eligible for the Employee Retention Credit (ERC) refund, based on certain criteria. If your hotel saw a significant decrease in gross receipts during any quarter compared to the same period in 2019, or if it was partially or fully shut down by government orders related to COVID-19, you might qualify.

To put it simply, a drop in your revenue by more than 50% in any quarter of 2020 or by 20% in 2021 compared to 2019, or any government-imposed restrictions like reduced operating hours, means you’re eligible. This could cover up to 70% of qualified wages and certain health insurance costs, up to $10,000 per employee per quarter in 2021—up to $28,000 per employee for the year.

Hotels in the U.S. have the potential to qualify for the ERC by showing either a considerable revenue loss or compliance with government shutdown orders, such as:

• Additional sanitization requirements;

• Social distancing restrictions;

• Capacity limitations;

• Take-out only requirements;

• Supply chain disruptions.

By understanding these pathways, hotels can effectively pursue the ERC for substantial financial relief, helping navigate the pandemic’s economic challenges.

Common Misconceptions about ERC Refund for Hotels

Despite the availability of the ERC, there are several misconceptions that might be holding you back from claiming your refund. Let’s dispel some of these myths so you can move forward with confidence.

1. If I received a PPP loan, I’m not eligible for the ERC: This is no longer true. Initially, businesses couldn’t claim the ERC if they had received a Paycheck Protection Program (PPP) loan. However, legislation changed, and now you can benefit from both programs, though not for the same wages.

2. Only small businesses can claim the ERC: This is not the case. The ERC is available to businesses of all sizes, including hotels with hundreds of employees, as long as they meet the eligibility criteria.

3. The process is too complicated: While the process does require attention to detail, it’s not insurmountable, especially with the right guidance. In fact, many businesses find that the financial benefits far outweigh the effort of applying.

By understanding the truth behind these common misconceptions, you’re better positioned to take advantage of the ERC and strengthen your hotel’s financial health.

How ERTC Express Help Hotels Maximize ERC Benefits

Understanding the ERC’s complexities can be overwhelming, but that’s where we at ERTC Express step in. Our specialized service helps  the hoteliers, navigate the application process, ensuring that you claim the maximum credit you’re entitled to. With a keen understanding of the tax code and the specific needs of the hospitality industry, we are equipped to guide you through the intricacies of the ERC program.

Step-By-Step Guide: How ERTC Express Help Hotels Maximize ERC Benefits

At ERTC Express, we specialize in assisting hotels in navigating the complexities of claiming the Employee Retention Credit (ERC) to ensure they receive every benefit they’re entitled to. Here’s our streamlined three-step process, designed specifically for hotels:

Step 1: ELIGIBILITY
Initially, we at ERTC Express begin by evaluating whether your hotel qualifies for the ERC. This involves a detailed review of your hotel’s operations during the pandemic, including any fluctuations in gross receipts and how governmental mandates have impacted your business. Our team of Account Executives is ready to guide you through the entire application process, ensuring we gather all necessary documentation for submission. Throughout this initial phase, we are available to answer any questions and provide any additional information you may need.

Step 2: PROCESSING
Upon confirming your hotel’s eligibility, our dedicated team of CPAs and Customer Success Agents immediately starts processing your claim. To minimize the risk of an audit and to ensure the defensibility of your claim, we employ our Power of 3 system. This unique approach involves three separate CPA teams agreeing on the final credit amount before submitting your claim. This collaborative process not only streamlines the calculation of the maximum credit by analyzing eligible wages and applicable caps but also reinforces the accuracy and compliance of your claim.

Step 3: RECEIVE YOUR FUNDS
The final step in our process occurs when you receive your funds. Importantly, you will only be billed for our services once the funds have been secured. This policy underlines our commitment to your success and ensures our efforts are directly aligned with the financial recovery of your hotel. Our team remains by your side even after filing, ready to address any IRS questions or provide further assistance, demonstrating our dedication to your hotel’s continued operation and success.

By partnering with ERTC Express, your hotel can confidently maximize its ERC benefits, turning a potentially daunting process into a strategic step towards financial recovery and growth. Our expertise and tailored approach ensure that your claim is handled efficiently and effectively, allowing you to focus on what you do best — running your hotel. Reach out to us today, and let ERTC Express help you secure every advantage the ERC has to offer.

Get Maximum Hotels Refund with ERTC Express to Get Maximum Hotels ERC Refund with ERTC Express

Securing the financial health of your hotel is essential, especially in the face of the challenges posed by the recent pandemic. The Employee Retention Credit (ERC) offers a significant opportunity to bolster your finances, and with ERTC Express, maximizing your hotel’s ERC refund is not just possible—it’s streamlined and effective. Here’s why you can trust ERTC Express to be the ally your hotel needs in these times:

• IRS Compliance: Our unwavering commitment to adhering to all IRS regulations and requirements means your ERC claim is in safe hands, ensuring full compliance and peace of mind for your hotel.

• Trusted by the AICPA: Recognition from the American Institute of Certified Public Accountants (AICPA) underscores our dedication to excellence and the highest professional standards in all our services.

• U.S.-Based CPAs: Our team is comprised entirely of U.S.-based CPAs, each specializing in the complex intricacies of ERC filings. Their expertise ensures top-tier assistance and guidance throughout the ERC claim process for your hotel.

• Power of Three – Audit Defense: We employ a unique audit defense strategy, involving three separate CPA teams that must agree on your claim’s final credit amount before submission. This rigorous process fortifies your claim’s defensibility and maximizes your chances of a successful outcome.

• Refund Maximization: At ERTC Express, we’re dedicated to ensuring you receive the full refund you deserve. Our team of ERTC specialists is adept at uncovering the most effective strategies to optimize your refund, consistently achieving results that exceed those of large payroll and software companies by 40-120%.

Choosing ERTC Express means selecting a partner committed to leveraging every opportunity the ERC offers your hotel. This partnership allows you to focus on running your hotel with the confidence that your financial recovery is being maximized in the background. Reach out to ERTC Express today, and take a significant step towards reinforcing your hotel’s financial health and ensuring its success in the face of ongoing challenges.

Frequently Asked Questions (FAQ)

Still have questions about the ERC? Let’s tackle some of the most common queries hotel owners have.

How do I know if my hotel is eligible for ERC?

To determine eligibility, assess whether your hotel experienced a significant decline in gross receipts or was subject to government-ordered full or partial suspensions. If either of these scenarios applies to your hotel, it’s worth taking a closer look at the ERC. Remember, it’s not about the size of your hotel, but the impact of the pandemic on your business.

Can I claim ERC if my hotel received a PPP loan?

Yes, you can! Initially, hotels that received a Paycheck Protection Program (PPP) loan were not eligible for the Employee Retention Credit. However, the rules have changed. Now, you’re able to take advantage of both programs. The key point to remember is that you can’t claim the ERC for the same wages that were covered by the PPP loan. It’s about ensuring no double-dipping, but with careful planning, you can benefit from both forms of assistance.

What criteria determine ERC eligibility for hotels?

Eligibility criteria include documented government orders affecting operational capacity and quantifiable declines in gross receipts compared to the same quarter in 2019.

How are eligible wages for the ERC calculated by hotels?

Hotels calculate eligible wages by considering all qualifying wages paid to employees during the periods of eligibility, subject to per-employee and aggregate limits.

What evidence is required for hotels to claim the ERC?

Hotels need to keep records of operational restrictions placed by government orders, payroll records for eligible wages, and financial statements showing declines in gross receipts.