The Employee Retention Credit (“ERC”) came into existence with the passing of the Coronavirus Aid, Relief and Economic Security (“CARES”) Act in March 2020. This tax credit encouraged businesses to keep employees on payroll during a time of tremendous economic uncertainty. Following the CARES legislation, The Consolidated Appropriations Act (“CAA”) was enacted in December of 2020 and the American Rescue Plan Act (“ARPA”) was subsequently enacted in March of 2021. Both ensuing legislative enactments amended and extended the availability of Employee Retention Credit throughout the entirety of the 2021 tax year. 

Following the three major legislative enactments noted above, the passing of the Infrastructure and Investment Jobs Act explicitly discontinued the Employee Retention Credit for the fourth quarter of 2021 (10/01/2021 – 12/31/2021). Therefore, eligible claims for ERC are limited to the time period of March 13, 2020 through September 30, 2021 (the third of quarter of 2021). Nonetheless, eligible ERC claims can serve a significant source of funding for future payroll, special projects, and more. 

While the criteria for eligibility and qualifying periods have undergone continuous restructuring, potential ERC claimants are well within the statutory amending period to elect the claim. As such, eligible ERC claimants are permitted to make such claims through the 2024 year. However, eligible claims relative to the 2020 year will begin to terminate in the upcoming 2023 year. Consequently, taxpayers should evaluate their eligibility so as to avoid foregoing a potentially lucrative benefit. 

With numerous ERC claims analyzed and delivered, KC & Associates is well equipped to navigate your company’s ERC eligibility while remaining within the scope of the original legislative intent. 

Contact KC & Associates today for your free evaluation!