ERC can be a windfall for businesses — but some are hitting a roadblock with the IRS - Dallas Business Journal

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The ERC could be a windfall. But some small businesses are finding themselves in a black hole.

based on wages for business owners to retain staff during the Covid-19 pandemic. It was set at 50% of up to $10,000 in qualifying wages per employee for the last three quarters of 2020. The American Rescue Plan Act extended and expanded the ERC to include up to 70% of $10,000 in qualifying wages per employee per quarter in 2021 for the first three quarters, making it much more lucrative to business owners.

While the IRS has not officially responded to the NAPEO’s letters regarding the ERC, Stohler said the organization has been told that PEOs are not being singled out. Stohler points to the internal processes at the IRS that are largely to blame, even as the IRS works on them. Stohler stressed the IRS’ reliance on paper filings, instead of electronic filings, slows the whole process down, especially for PEOs.

 

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