Home Health

Strengthen the Financial Health of Your Business

At StenTam, we’ll work on maximizing your tax credits so you can focus on the important task of taking care of patients in their homes.
Many patients, especially those with chronic conditions, didn’t want to leave their homes during the COVID-19 pandemic for fear of contracting the contagious virus. But, some still required at least some level of healthcare to manage their conditions. Without home health employees, that would not have been possible.

Nearly half of home health businesses reported an increase in patient cancellations or refusal of services due to fears of COVID-19 transmission. For patients who still required care, there was a 30 decrease in available staff.

The home health industry has not been exempted from higher costs, spending more on virtual care technology and personal protective equipment (PPE) to ensure the safety of both patients and employees. One way these businesses can recoup revenue lost during the pandemic is through the Employee Retention Credit (ERC).

A payroll tax credit introduced through the Coronavirus Aid, Relief and Economic Security Act (CARES Act), the United States government enacted the ERC to encourage businesses to keep their employees on the payroll during the pandemic. How much eligible home health employers receive through the Employee Retention Credit depends on the calendar quarters they claim it.

For 2020, the ERC is a credit against certain payroll taxes of 50 percent of the wages paid — up to $10k per employee — from March 12 – December 31, 2020 (capped at $5k per employee). For 2021, the ERC is a quarterly tax credit of 70 percent of the first $10,000 in wages per employee in each quarter of 2021 from January to September 2021 (capped at $7K per employee per quarter).

Government Orders

Example: Minnesota, April 9, 2020 – Governor Walz signed Emergency Executive Order 20-22, which extends the previous stay at home Order and reaffirms the temporary closure of bars, restaurants, and other places of public accommodation. Minnesota residents are ordered to stay at home or in their place of residence except to engage in Critical Activities and Critical Work Sectors. Critical sectors include healthcare, food and agriculture, energy, transportation, public works, and communications, among others. The Order is now in effect until May 3, 2020.

Find More Government Orders Specific to Your State on Our Insights Page

This comprehensive list of FAQs offers answers to common questions about the Employee Retention Credit:

How Might the ERC Benefit My Home Health Business?
Perhaps most importantly, funds received through the Employee Retention Tax Credit can ensure home health businesses have the staff and resources to adequately meet patient needs. Retaining staff during periods of reduced operations or temporary closures is especially important in an industry where continuity of care is crucial. Also, by offsetting the cost of wages, the ERC can effectively reduce labor costs, thereby helping home health businesses maintain their operations with less financial stress.
For How Long Is the Employee Retention Credit Available?
The ERC expired in September 2021, but eligible home health businesses still have time to file paperwork and retroactively receive claims for the ERC in 2023. To do so, they must file a Form 941-X for relevant quarters. For all four quarters in 2020, the deadline to apply is April 15, 2024. For all quarters in 2021, the deadline is April 15, 2025.
How Do I Know if My Home Health Business is Eligible for the ERC?
You may be eligible for the Employee Retention Tax Credit if your business operations were fully or partially suspended by governmental COVID-19 orders, thereby limiting commerce, travel or group meetings. Your business also might be eligible if it experienced a significant decline in gross receipts during 2020 or within the first three quarters of 2021. New startup businesses that began operations after February 15, 2020, may also qualify, regardless of revenue.

There are two main ways to be eligible for stimulus refunds:

  • If your business matches the required decline in revenue within any quarter of 2020 or 2021.
  • If you have W-2 employees.
What Exactly Is “a Significant Decline in Gross Receipts” Under the Employee Retention Credit Program?
The answer to this question varies from 2020 to 2021. A home health employer had a significant decline in gross receipts in 2020 during the first calendar quarter if its gross receipts for that quarter were less than 50 percent of those for the same calendar quarter in 2019. An employer had a significant decline in gross receipts in 2021 during the first calendar quarter for its gross receipts for that quarter if they were less than 80 percent of those for the same calendar quarter in 2019.
How Do I Apply for the Employee Retention Credit?
Home health employers must first determine their eligibility, starting by ensuring they meet IRS qualifications. To retroactively claim the ERC, amend previously submitted Forms 941 by filing and submitting Form 941-X for each qualifying quarter.

The team at StenTam is ready and available to help you accurately and completely claim your maximum ERC — all while maintaining compliance and minimizing risk. Contact us today to get started!

Qualifying orders (From IRS)

What kind of government orders qualify my business or organization for the ERC? (added July 28, 2023)
To qualify for ERC, you need to have been subject to a qualifying government order related to COVID-19 that caused a full or partial suspension of your trade or business operations. The government order may be at the local, state, or federal level.

Examples of governmental orders:

  • An order from the city’s mayor stating that all non-essential businesses must close for a specified time period;
  • A state’s emergency proclamation that residents must shelter in place for a specified period, except for essential workers;
  • An order from a local official imposing a curfew on residents that impacts the operating hours of your trade or business for a specified time period;
  • An order from a local health department mandating a workplace closure for cleaning and disinfecting.
Can I rely on a recommendation, bulletin or statement issued by a government authority to qualify for ERC? (added July 28, 2023)
No. To qualify for the ERC, you must have been subject to a government order that fully or partially suspended your trade or business.
Recommendations or statements encouraging you to take certain actions are not orders.
If you use a third party to calculate or claim your ERC, you should ask them to give you a copy of the government orders – not a generic narrative about an order. Read the order carefully and make sure it applied to your business or organization.
Is being subject to a government order enough to make me eligible for ERC? (added July 28, 2023)
No. You need to demonstrate that the government order was related to COVID-19 and that it resulted in your trade or business being fully or partially suspended.
What does it mean to be fully or partially suspended? (added July 28, 2023)
Whether your business or organization was fully or partially suspended depends on your specific situation. For examples, see Notice 2021-20, Part III, Section D.

Some examples of who doesn’t qualify under this eligibility factor:

  • If all your employees were able to telework during the pandemic and your business continued to operate, your business wasn’t suspended.
  • If your customers were affected by a stay-at-home order, but no orders applied to your business operations, you weren’t suspended.
  • If you voluntarily closed your business or reduced hours of operation, you weren’t ordered to suspend.

You could still qualify for ERC based on a decline in gross receipts even if you don’t qualify under suspension of operations due to government order.

Was my business or organization fully or partially suspended if I had a supply chain issue? (added July 28, 2023)
A supply chain issue, by itself, does not qualify you for the ERC.

The IRS provided a narrow, limited exception if an employer was not fully or partially suspended but their supplier was. However, it applied only when the employer absolutely could not operate without the supplier’s product and the supplier was fully or partially suspended themselves.

In addition to having the supplier’s governmental order, you will need to show that:

  • The government order caused the supplier to suspend operations,
  • You couldn’t obtain the supplier’s goods or materials elsewhere (regardless of cost), and
  • It caused a full or partial suspension of your business operations.

Why Work With StenTam?

Your Home For Specialty Tax Services

The foundation of any successful home health business is dedicated employees, especially as demand increases along with workforce shortages. Providing health and personal care services and helping patients manage chronic diseases requires both skill and compassion. By enlisting StenTam to take care of finding and maximizing your eligible tax credits and incentives, you can focus on investing in the areas that keep your business healthy and strong.
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Secure Technology

Our proprietary software enables you to securely transfer information to our team with every transaction.
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Compliance-Driven

Never skipping a beat: working with our team means that every filing gets executed with a focus on compliance.
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Risk-Free Filing

Each claim receives the appropriate documentation and audit ready file. StenTam is your long-term solution, and will help you defend your claim should there be an inspection.

Client Case Study

Zimmerman’s Automotive Services

Small, family-owned businesses were strongly impacted by the pandemic and the accompanying government-mandated shutdowns. A Pennsylvania-based automotive service provider struggled as these shutdowns made it more difficult to keep their...

Read More
Zimmerman’s Automotive Services

Zimmerman’s Automotive Services

Small, family-owned businesses were strongly impacted by the pandemic and the accompanying government-mandated shutdowns. A Pennsylvania-based automotive service provider struggled as these shutdowns made it more difficult to keep their...

Read More
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