The Employee Retention Tax Credit is a provision of the CARES act that is designed to serve as a tax credit for restaurants that faced a loss of income due to the COVID-19 pandemic. In 2020, restaurants that had less than 100 employees were eligible for a tax credit of up to $5,000 per employee, per quarter. As of 2021, restaurants are now eligible for up to $7,000 per employee, per quarter. Even if your restaurant business obtained a PPP loan, you may still be eligible to claim the ERTC on wages that weren’t treated as payroll costs. These credits can be claimed on you 941 payroll tax return for each quarter in 2021, whereas a 941-X can be filed to claim the credits on eligble quarters in 2020.
