Coalition of organizations sent a letter to U.S. House and U.S. Senate leaders
In the CARES Act of 2020, Congress created the Employee Retention Tax Credit (ERTC), to aid small businesses during the COVID-19 pandemic. The ERTC aimed to incentivize employee retention by offering employers a quarterly credit for each qualified employee. On June 2, a coalition of 102 organizations advocating for reinstatement of fourth quarter 2021 access to the ERTC sent a letter to the majority and minority leaders in the U.S. House of Representatives and the U.S. Senate. NFIB was joined by a range of different industries and nonprofits in urging Congress to reinstate the ERTC for its originally planned timeframe.
“The Employee Retention Tax Credit Reinstatement Act (H.R. 6161/S.3625) is strong legislation currently boasting over 100 bipartisan cosponsors across both chambers, including 57 Republicans and 46 Democrats,” the letter states. “The legislation is supported by nearly 70 small business and nonprofit organizations and is the best viable option to restore much needed assistance that was previously promised, but subsequently denied.”
The ERTC was originally set to expire on January 1, 2022, giving employers the ability to claim it for all four quarters of 2021. Since the ERTC offered savings of $7,000 per employee per quarter in 2021, this meant employers were eligible to up to $28,000 per employee in tax credits last year.
However, on November 15, 2021, the federal Infrastructure Investment and Jobs Act (IIJA) was signed into law. This bipartisan physical infrastructure law includes a provision changing the ERTC’s timeframe to only apply for the first three quarters of 2021, and not Q4.
On Feb. 10, the U.S. Senate joined the U.S. House of Representatives by introducing the Employee Retention Tax Credit Reinstatement Act.
If the early termination of the ERTC is harmful to your business, please tell your Representative and Senators to support the ERTC Reinstatement Act and make this crucial credit available as planned.