The tax relief, which covered the cost of keeping workers on the payroll, required employers to show they faced hardship due to pandemic restrictions or declines in business. It was handed out as a refundable payroll tax credit, meaning nonprofits and businesses could receive more funds from the government than they owed in employment taxes.
Prior to its expiration, the employee retention tax credit was worth up to $28,000 per employee, and businesses with up to 500 employees could access it whether or not they laid off or laid off workers, unlike to large employers.
The infrastructure bill didn’t finally pass the House until weeks into the fourth quarter, meaning a retroactive end to the relief and a need for some businesses that have already taken advantage of the credit to pay back the ‘IRS. This, combined with worsening pandemic conditions at the end of the year, fueled support to reverse the trend.
Zerbe, now national managing director of tax services firm Alliantgroup, which helps businesses and charities qualify for the credit and is pushing for his return, said there is clear bipartisan support for reinstating the pause. But he said business owners and charities should “make noise” to help make it happen.
Lobbyists and House members pushing for the aid measure to be reinstated have stepped up their pressure over the past week.