What Are the Key Takeaways from IRS Guidance on the ERTC?

October 18, 2023
Dayes Law Firm

The Employee Retention Tax Credit (ERTC/ERC) has been around for a few years, but some of the details about the program have changed over time in accordance with actions by the IRS as well as new government legislation. If you’re a business owner interested in claiming the ERC, it can be hard to figure out what’s important in the midst of all of those changes. 

But there are some key takeaways from IRS guidance on the Employee Retention Tax Credit that can help you if you want to claim the ERTC or get the assistance of reputable tax attorneys to help you claim it. 

Key IRS Takeaways About the ERTC

The IRS has a FAQ section on its website about the Employee Retention Tax Credit that is regularly updated. It answers frequently asked questions you may have as a business owner and can help you sort out the key takeaways you need to know if you want to claim the ERTC.

On that IRS guidance, the IRS notes that not every business is eligible to claim the tax credit. “There are very specific eligibility requirements for claiming the ERC,” the FAQ guidance notes. “Eligible employers can claim the ERC on an original or amended employment tax return for qualified wages paid between March 13, 2020, and December 31, 2021.”

It also reveals that to qualify to claim the credit, employers must have either experienced a full or partial suspension of operations due to an order “from an appropriate governmental authority limiting commerce, travel, or group meetings because of COVID-19 during 2020 or the first three quarters of 2021,” or encountered a significant decline in gross receipts during 2020 or a decline in gross receipts in the first three quarters of 2021, or qualified as a Recovery Startup Business for the third or fourth quarters of 2021.

The IRS FAQ page about the Employee Retention Tax Credit also notes that participating in the Paycheck Protection Program (PPP) doesn’t affect your eligibility for the ERTC.

Recent IRS Guidance on the ERTC

More recently, the IRS released an announcement that the agency has put in place a moratorium on the processing of new ERTC claims through year’s end as a result of concerns about fraudulent claims. 

“We could no longer tolerate growing evidence of questionable claims pouring in,” IRS Commissioner Danny Werfel said in a statement released on September 14. As for businesses that are still interested in claiming the credit, he added, “Businesses should seek out a trusted tax professional who actually understands the complex ERC rules.”

As part of that announcement, the IRS included key takeaways about being eligible for the Employee Retention Tax Credit and about what businesses should do during the moratorium period. The guidance advised that businesses that haven’t filed a claim yet should “consider reviewing the guidelines and waiting to file.”

Dayes Law Firm ERTC Application Assistance 

During this pause in processing Employee Retention Tax Credit claims, you can still turn to a team of tax professionals like the ones at Dayes Law Firm for help with your application. Our clients have already received over $25 million in funds for ERTC claims so far, and we have a proven record of success in helping businesses apply for the credit. 

Our team can work with you to make sure all of the ERTC guidelines are followed, and your business is truly eligible to apply for the credit. We can help you with every step of the application process and answer any questions you may have in a free, no-obligation consultation. 

Please contact us by giving us a call at (800) 503-2000 to learn more!