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Painting Biz Owners: We’re talking about ERC & what happened this year. Does it relate to your biz?

Name: Painting Biz Owners: We’re talking about ERC & what happened this year. Does it relate to your biz?
Uploaded: 2023-12-07T19:04:37+00:00
Duration: 1 s
Channel: Daniel Honan
Description: In this brief YouTube segment, two speakers discuss the Employee Retention Credit (ERC). Speaker B explains that the IRS has temporarily halted…

7 Dec 2023 · 0 min

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In this brief YouTube segment, two speakers discuss the Employee Retention Credit (ERC). Speaker B explains that the IRS has temporarily halted processing of new ERC claims due to a massive backlog, with no new returns being processed until January 1, 2024. The agency is shifting from rapid disbursement to more front‑end verification to ensure claim validity. Speaker A then provides a concise definition of the ERC, describing it as a refundable payroll tax credit designed to encourage businesses affected by the COVID‑19 shutdowns in 2020 to retain employees, effectively supporting small businesses that remained operational while shut down.

Employee Retention Credit.
They're going to be pausing the processing of ERC credits. Not ending, but it is taking a little bit of a hiatus. The reason is, is they are so backlogged they cannot process the ones they have, let alone any new ones. They will not be processing any new returns until January 1st, 2024. They've also shifted their focus from basically cranking these out and getting the checks out as fast as possible to doing a little bit more verification on the front end, making sure that these claims are valid claims, they're appropriate.
If listening, you have no idea what the Employee Retention Credit is. It's also referred to as the ERC. It's a refundable payroll tax credit. It's taken against employment taxes that encourages businesses impacted by COVID-19 pandemic to keep their employees on payroll. This is going back to when those shutdowns were happening back in 2020, kind of helping small businesses that had to basically keep their folks employed during that period while also being shut down.