Employee Retention Credit
Many congregations took advantage of the Paycheck Protection Plan funds offered by the federal government during the pandemic. There is now a second source of funds that may be available to you: the Employee Retention Tax Credit. While this credit was originally not available to those who received PPP funding, Congress has amended legislation so all eligible non-profit organizations to apply.
This credit is a refundable payroll tax credit that can be claimed by employers including nonprofits who retained and paid qualified wages to employees (clergy are not considered employees for the purposes of this credit) during the period March 12, 2020 – June 30, 2021. The amount of the credit (and the cash to be refunded) can be significant.
Although there are multiple ways to qualify for these credits, eligibility requirements are complex. The credit is claimed by filing amended Forms 941 (the quarterly employment tax returns). Congregations that use payroll services should consult your payroll provider for guidance.
More information about the credit can be found in the Employee Retention Credit FAQ provided by the ELCA.
The Synod finance committee can also provide information to your congregation. If your congregation has already applied for or is planning to apply for these credits, please let the Synod finance committee know by emailing firstname.lastname@example.org.
NOTE: The IRS has issued an alert to businesses and tax-exempt organizations to be aware of scams associated with the ERC, especially unsolicited emails and/or calls claiming to verify eligibility in minutes.