Employee Retention Credit (ERC) has been a rollercoaster of confusing information coming from the IRS since June 2023.
Summary:
- July 2023 – The IRS announced that the backlog of applications had been caught up and to expect a 90-day processing time for applications.
- September 2023 – The Commissioner of the IRS announced they had been overrun with filings, most of which they believed to be fraudulently submitted by unscrupulous “filing mills”. All new submissions after September 14, 2023, were not being accepted for filing until further notice, but at least until after December 31, 2023.
- November 2023 – The IRS advised those who had not already submitted an application for refund to do so, but that none of the submissions would be opened until further notice.
- January 2024 – The IRS Commissioner offered the U.S. House of Representatives the remaining budget for ERC refunds back to Congress in exchange for an abrupt and immediate cessation of all handling of ERC applications – cold turkey. On January 28, 2024, the House passed a bill that did just that.
Now for the rest of the story:
Even though the House passed its bill and sent it to the Senate, the Senate has yet to take up the bill in committee, debate, or a vote as of March 8, 2024. The likelihood of that happening is growing less each day and with each passage of separate bills funding the US Government.
HOWEVER!!
There is a firm statute of limitations that will take effect on April 15, 2024. After that date, there can be no more applications for refunds for the year 2020. However, 2021 can still be applied for until April 15, 2025. So, any church wanting to get their refund for 2020 must have their application postmarked (there is no electronic filing for ERC permitted) by April 15, 2024; that is, about a month from the date of this blog.
If your church has not filed for ERC and wishes to do so, it is imperative that you start now. Click here to begin the process. Fill out the form with your information found on the web page. We will send you the list of required information to gather and send to us for processing. We need at least three days once we receive your information to do the analysis of your eligibility and prepare any necessary documents. It may take you several days to gather your information, which adds time to the process. Start now.
You can also check out this blog on Understanding the Employee Retention Credit.
About James Jordan
James Jordan is the Managing Member of James B. Jordan CPA, LLC, a nationwide full-service CPA firm that exclusively focuses on churches and specializes in ERC services. He has been a frequent speaker at ACS Technologies conferences, teaches financial management for clergy at Emory’s Candler School of Theology, and is the author of Financial Management for Episcopal Parishes.
