The ERC is available to businesses, non-profit organizations, and specific governmental agencies if they experienced any of the following: adas
Significant Decline in Gross Receipts: There must be a substantial reduction in the business's gross receipts. For 2020, this is defined as a decline in gross receipts of more than 50% compared to the same quarter in 2019. For the first three quarters of 2021, the requirement is a decline in gross receipts of more than 20% compared to the same quarter in 2019.
Full or Partial Suspension: The employer must have experienced a full or partial suspension of business operations during 2020 or the first three quarters of 2021 due to orders from a governmental authority related to COVID-19. This suspension could be due to limitations on commerce, travel, or group meetings.
Recovery Startup Business: For businesses that started after February 15, 2020, and have annual gross receipts of less than $1 million, they may qualify as a recovery startup business. Recovery startup businesses can qualify for the fourth quarter of 2021 in addition to the other eligible quarters. Eligible employers can claim the ERC for qualified wages paid between March 13, 2020, and December 31, 2021.
With recent updates and complexities surrounding ERC, businesses are now navigating the landscape of programs like the Voluntary Disclosure Program and the Withdrawal Program to ensure compliance.