The Infrastructure Investment and Jobs Act, recently passed by Congress and signed into law by President Biden on November 15, 2021 makes wages paid after September 30, 2021 ineligible for the employee retention credit (ERC), except for wages paid by a recovery startup business. A recovery startup business is generally defined as a business that began operating after February 15, 2020 and had average annual gross receipts of less than $1 million.
Therefore, with limited exception, the 2021 ERC is only available for the first, second and third quarters of 2021 (the ERC also continues to be available from March 13, 2020 through December 31, 2020).
To claim the ERC for a calendar quarter for which the employer has already filed Form 941, the employer must file a Form 941-X (amended Form 941) for the applicable quarter(s). Generally, Form 941 can be amended within three years of the April 15 following the applicable calendar quarter. For example, you can amend Form 941 for quarter two of 2020 by April 15, 2024.
For more information about the ERC, see our firm’s summary and commentary on the ERC here. Our summary contains links to IRS guidance as well.
BMWL Can Help
BMWL’s COVID-19 Task Force is ready, willing, and able to help our clients navigate the Employee Retention Credit. Nonprofit organizations that would like the assistance of our Task Force in addressing the Program should contact us at [email protected].