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April 2, 2021

IRS issues guidance for employers claiming Employee Retention Credit for Q1 and Q2 2021

The IRS has announced (IR-2021-74) new guidance (Notice 2021-23) for employers claiming the Employee Retention Credit (ERC) under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) modified by the Taxpayer Certainty and Disaster Tax Relief Act of 2020. The notice explains changes to the ERC for the first two calendar quarters of 2021, including: an increase in the maximum credit amount; the expansion of the category of employers eligible for the ERC; modifications to the gross receipts test; revisions to the definition of qualified wages; and restrictions on requests for advance payment of the ERC.