For Atlanta businesses substantially affected by COVID-19, the employee retention credit (ERC) has been one of the more valuable incentives to keep workers on the payroll. Since its inception in March 2020, the ERC has undergone several modifications and extensions which has increased the credit’s value. There was an initial extension for the first half of the year in the Consolidated Appropriations Act, 2021, (CAA) and then another through the end of the year in the American Rescue Plan Act. The changes are meant to provide additional relief to businesses challenged by the pandemic. However, many have been unable to move forward because of a lack of formal guidance by the IRS. The good news is earlier this month the IRS published Notice 2021-23 which provides important details for claiming the credit in 2021. The guidance applies only to changes made under the CAA and not others enacted later. To help clients, prospects, and others, Wilson Lewis has provided a summary comparison of the changes below.
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Remember the guidance applies only to the changes made under the CAA and not the more recent American Rescue Plan. As a result, it is expected the IRS will issue additional guidance for claiming the credit in the second half of the year. If you have questions about the information outlined above or need assistance calculating and claiming the credit, Wilson Lewis can help. For additional information call us at 770-476-1004 or click here to contact us. We look forward to speaking with you soon.
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