ERTC for Schools
What is ERTC?
The government has authorized what is known as the Employee Retention Tax Credit Program (ERTC). This program could provide you, the school, a refundable credit of up to $26,000 per W-2 employee in addition to your Forgivable PPP Loan.
You can qualify even if you received PPP funds.
Initially, with the CARES Act, employers could choose to apply for PPP or claim ERTC credits, but not both.
PPP was more beneficial than ERTC for most businesses (for reasons we won’t go into here), so most companies with under 500 employees received forgivable PPP Loans.
On March 11, 2021, The American Rescue Plan Act of 2021 was signed into law and included many modifications and expansions to existing elements of previous stimulus programs.
Noteworthy modifications for private schools included:
- Private schools that applied for and received PPP funds could now claim ERTC credits.
- ERTC credits could be retroactively claimed for private schools that qualified in 2020.
- ERTC credits were extended through 9/30/21 with lower qualification requirements.
- The per-employee cap on qualifying wages increased from $10,000 for all of 2020 to $10,000 per quarter for the first three quarters of 2021.
- The refundable credit amount increased from 50% of qualifying wages in 2020 to 70% in 2021.
So the short answer is “Yes,” . . . your private school can claim ERTC even if you received PPP funds.