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The ERC Deadline for 2024

On January 16th, the chairmen of the Senate Finance Committee and the House Ways and Means Committee introduced the Tax Relief for American Families and Workers Act of 2024. The introduction of this act threatens to end the Employee Retention Credit (ERC) program on January 31, 2024. This would be months before the initial ERC deadline of April 15th for the 2020 tax year.

Even though it is already late January,  it is possible the January 31 deadline would be enforced retroactively even if enacted after the deadline. 

If you have not yet submitted a claim for the ERC tax credit, you it would be a good idea do so before the proposed deadline on January 31st. Contact our experienced ERC consultants to start your application today.


ERC Statute of Limitations

According to the general statute of limitations, ERC claims would have had until the following deadlines to apply for the ERC tax credit:

  • All four quarters of 2020 tax year: April 15, 2024

  • First and second quarters of 2021 tax year: April 15, 2025

  • Third and fourth quarters of 2021 tax year: April 15, 2025


The refund statute of limitations and audit statute of limitations are both three years. A statute of limitations is a law that sets the maximum amount of time to file a legal proceeding. In the case of ERC, it is the maximum amount of time that businesses have to file a claim with the IRS for the refundable tax credit. After this time, the IRS will no longer be accepting applications.


However, the Tax Relief for American Families and Workers Act of 2024 (the Act) would make the ERC deadline earlier. If approved, businesses will have to have filed their claims with the IRS before January 31st of this month.


If you have not already filed your ERC tax credit, consult with one of our specialists at soon as possible to file your claim. Our team of ERC specialists consists of tax professionals and tax attorneys who take pride in the efficiency in which they file applications to the IRS. To be on the safe side of the possible deadline next week, it is best to file now.


Increased Threats Against ERC Fraud

The Act also proposes increased penalties for false claims submitted to the IRS. To ensure compliance with the IRS, these increased penalties would go towards any ERC mills that push ERC false claims to the IRS, when businesses are not fully eligible under IRS requirements.


The biggest delay hindering businesses from receiving their refundable tax credit is a surplus amount of false claims submitted to the IRS. This caused the IRS to put a pause on processing new ERC claims, while the IRS worked on modifying the program to better protect businesses from falling into these scams.


Any businesses who submitted claims to the IRS for the ERC tax credit without being fully eligible will receive a letter in the mail. This letter provides applicants who submitted false claims to withdraw their ERC claim. False claims put businesses at risk of an audit from the IRS.


If your business submitted a claim with the help of an ERC mill, contact one of our certified ERC experts to determine your eligibility. If you are not eligible under IRS requirements, you will need to proceed in withdrawing your ERC claim.


What Is the Tax Relief for American Families and Workers Act?

The Act proposes changes to the child tax credit and research & development expensing. If approved, it would apply beginning with the 2023 tax year. The research and development expensing would provide interest deduction for businesses, expand small-business expensing, and extend bonus depreciation. However, it would also put an end to the ERC tax credit.


While approval of this act is yet to be determined, it is best to be on the safe side and apply for the ERC tax credit before January 31, 2024. There are plenty of businesses who have already applied and are still waiting on receiving their refundable tax credit. Waiting on the credit impacts businesses, especially small businesses with tighter profit margins. You do not want to have to wait longer for your business to receive the financial relief it needs post-COVID-19 pandemic.

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