Skip to content

Selling Your ERC Refund Claim: Is it a Loan?

In recent months, many businesses have been turning to the Employee Retention Credit (ERC) as a lifeline to keep their operations running during the COVID-19 pandemic. However, some businesses are finding it difficult to wait for the government to send them the funds they need. As a result, some have
turned to ‘selling” their ERC refund claim to receive cash immediately. But is this process considered aloan?
According to experts in the field, the answer is no. “Selling” your ERC refund claim is not a loan of anykind, but is more typically referred to as an “asset purchase” Its’ actually an advance against your ERC refund claim today at a discount against the funds you would receive six months or a year later. There
are no weekly or monthly payments of any kind associated with this process.
The “asset purchase “process can be a lifesaver for businesses struggling to make ends meet. With the growing number of refund applicants today, it can take anywhere from 6 months to a year for the government to send a company’s ERC refund check. This can be a long time for businesses that need the
funds to stay afloat. However, with the help from companies like The ERTC Funding Network, in some cases, it can typically only take 10 days or less to be approved.
But what are the downsides associated with financing your ERC refund claim? Experts caution that with an advance at a discount requires leaving a portion of your money on the table. The amount you receive today will be less than the full amount of your refund claim. However, for some businesses, the
immediate cash flow can be worth the discount, particularly since most see it as “found money” anyway, and any form of financing always has a cost.
It’s also important to work with a reputable company when financing your ERC refund claim. There aremany scams and fraudulent companies out there, so it’s important to do your due diligence and workwith a trusted partner.
In conclusion, the “asset purchase” approach for financing your ERC refund claim is not considered a loan, but rather an advance at a discount against your refund claim. It can be a useful tool for businesses struggling to make ends meet and in need of immediate cash flow, or for those who may have an
immediate opportunity and could use the money right now to take advantage of it.
However, it’s important to work with a reputable resource and consider the potential risks and benefits before making a decision.
Gerald Watson, president and Founder of The ERTC Funding Network, a financial intermediary specializing in arranging financing for ERC refund claims says” be sure and ask the TOP 10 Questions below BEFORE your apply for ERC refund financing”. You won’t regret it!”
TOP 10 Questions To Ask BEFORE you apply for ERC refund Financing​
  1. Is the ERC funding a loan or an “asset purchase”?
  2. What documents do I need to submit when applying?
  3. Am I eligible if I have past due taxes or a tax lien?
  4. How long does it normally take to be approved and funded?
  5. Can I fund against only a portion of my ERC refund?
  6. Are there any monthly interest payments?
  7. What if I have UCC filings or MCA’s? Am I still eligible?
  8. What are ALL of the costs?
  9. Do I receive the interest paid from the government, if any, from my ERC refund claim?
  10. Can you pay my ERC preparer directly from funding proceeds?