The maximum credit amount per employee under the 2020 Employee Retention Credit (ERC) was $5,000 for the entire year. This is because the credit amount was capped at 50% of qualified wages paid to an employee between March 13, 2020, and December 31, 2020.
The ERC for 2021 provides eligible employers with a tax credit of up to 70% of qualified wages paid to employees during the year. The maximum credit amount per employee is $21,000, which is significantly higher than the previous year's limit of $5,000. The increase in the maximum credit amount is intended to provide more financial relief to businesses impacted by the ongoing COVID-19 pandemic.