| The Employee Retention Tax Credit (ERTC) will be terminated early as a result of legislation signed into law November 15, 2021 (H.R. 6384). The Infrastructure Investment and Jobs Act ends the ERTC retroactively, making wages paid after September 30, 2021 ineligible for the credit. The ERTC was created by the CARES Act in 2020, then amended by the Consolidated Appropriations Act later that year. The American Rescue Plan Act of 2021 extended ERTC for qualified employers through the third and fourth quarters of 2021. IRS Notice 2021-49 offered guidance for ERTC claims for third and fourth quarters of 2021; however, with the early termination of ERTC, IRS guidance will be needed to instruct employers that may have already adjusted their payroll tax deposits for the four quarter. The ERTC was available to eligible employers and calculated on qualified employee wages as a payroll tax credit on Form 941 for keeping employees on payroll through the pandemic. Eligible employers may claim ERTC retroactively by submitting Form 941-X to amend the original filing. Employer eligibility, ERTC qualified employee wages, and ERTC eligible periods may be tricky to navigate. Consult with your tax advisor to see if your business qualifies for ERTC and see links below for additional information. Click here to read more about this information. Submitted by: Amy McGhinnis Source: journalofaccountancy.com |
