Will the ERC Terminate after September 30, 2021?
Many farmers are or will qualify for the employee retention credit (ERC) based on their quarterly revenues in 2021 being at least 20% lower than the same quarter in 2019. This credit can be substantial if the farmer qualifies for all four quarters in 2021 since an employee with at least a $40,000 annual wage could qualify for a $28,000 tax credit that is refundable.
ERC had been extended through December 31, 2021, however, the proposed infrastructure bill just released has a proposal to terminate the ERC as of September 30, 2021 unless you are a “qualified recovery startup business” which would not apply to most farmers.
This bill has not passed yet and will still need to work its way through House which wants to tie it to the “human infrastructure bill”. Just be forewarned that the ERC may terminate as of September 30, 2021.
Paul Neiffer is a certified public accountant and business advisor specializing in income taxation, accounting services, and succession planning for farmers and agribusiness processors. Paul is a principal with CliftonLarsonAllen in Walla Walla, Washington, as well as a regular speaker at national conferences and contributor at agweb.com. Raised on a farm in central Washington, he has been immersed in the ag industry his entire life, including the last 30 years professionally. Paul and his wife purchase an 180 acre ranch in 2016 and enjoy keeping it full of animals.
Paul, How does a farmer file for the ERTC during the year? The ERTC was calculated on a quarterly 941. The farmer files a calendar year 943.
If you have a Blog that addresses this, please let me know.
Thanks, Phil Showmaker