An employee is considered full-time if they worked at least 30 hours per week, or 130 hours per month on average during 2019. Please keep in mind that this question pertains to the average number of employees throughout 2019.".

Important: The ERC credit is subject to the IRS aggregate rule. If your business has common ownership with other businesses, you must consider all associated businesses when calculating this question. It is important to note that if your business is an aggregated large employer, the ERC credit is not available. To learn more about the aggregated large employer rule and its application to your business, read here:What is an Aggregated Large Employer?

Example: The majority owner of ABC Company also owns 123 Company, which had an average of 75 full-time employees in 2019. Since the two companies have common ownership, the employee count of both companies must be combined for the purposes of the ERC program. Even though both companies are eligible to participate in the program, they would be considered as having over 100 employees under the aggregate rule.

Note: Businesses that had more than 100 full-time employees but less than 500 full-time employees in 2019 are not eligible for ERC funds in 2020. However, businesses that had over 500 full-time employees in 2019 may still qualify for the ERC program for actual wages paid to employees who did not work due to a government shutdown.

To qualify for the partial or full shutdown credit, your business must pass the "suspension test" which demonstrates that your operations were either partially or fully suspended due to a Covid-19 governmental order. It's important to note that even if the government order was not given directly to your business, a government restriction may still have had a direct impact on your operations.

Important: It's important to remember that this qualification only applies during the period of the actual government order. Since there were very few government shutdown orders during 2021, this type of qualification mainly applies to the 2020 quarters. However, if the impact of the shutdowns continued to affect your business beyond the actual shutdown period, then this qualification may still apply.

For more information on the suspension qualification, please refer to the following IRS notices: Notice 2021-20, Notice 2021-23, Notice 2021-33, and Notice 2021-49.

Full or partial suspension qualification requirements

• The suspension qualification requires that the partial or full shutdown from a Covid-19 government order had a more than nominal impact on your business, which means it affected more than 10% of your operations. This impact can come from a reduction in business hours of 10% or more, or a suspension of revenue-producing operations that represented 10% or more of gross receipts compared to 2019. Note that a 10% reduction in sales is not required, but the order must have suspended at least 10% of your revenue-generating operations.

Here are a couple of examples to clarify:

• A restaurant had to close 2 hours early due to curfew requirements under government orders. The 2 hours represented 15% of the business's working hours. This business qualifies for the period affected by the government order
• A radiology clinic had to stop elective procedures during Q2 & Q3 of 2020 due to government orders. Upon review of gross receipts for those quarters in 2019, the suspended elective procedures represented 18% of the clinic's total gross receipts. This business qualifies for these two quarters.

Incapability to transition to remote work - If a business was able to convert to a remote work environment that effectively mitigated the nominal impact on the business, they do not qualify for the suspension qualification.