When Is The ERC Tax Credit Deadline?
When is it too late to apply for the Employee Retention Tax Credit? Read about the important deadlines for the ERC refund here.
On 11/14/23, IRS Commissioner Daniel Werfel announced that the IRS is updating its ERC review procedures and will begin processing new ERC claims in the near future following the moratorium implemented in September. Existing claims are still being processed and eligible businesses can still submit an ERC claim through reputable ERC specialists to be processed when the moratorium ends. Visit our full breakdown of the ERC pause for the latest information.
If you didn’t claim the Employee Retention Tax Credit, there’s still time — even with the recent IRS pause on processing ERC refunds.
There are important ERC deadlines to keep in mind to make sure that you get the credit you’re owed, and hitting these deadlines will be more important than ever now that the processing time for ERC refunds has increased.
Keep reading to learn more about the ERC tax credit deadlines you need to know so you don’t miss out on receiving your refund.
Table of Contents
- A Quick Recap On The Employee Retention Tax Credit
- Can You Still Apply For the ERC In 2023?
- Will The IRS ERC Pause Affect The ERC Application Deadline?
- When Is The ERC Deadline For The Qualifying Period In 2020?
- When Is The ERC Deadline For The Qualifying Period In 2021?
- Does Filing The ERC With An ERC Preparer Affect The ERC Application Deadline?
- The Bottom Line On ERC Credit Deadlines
- FAQs: ERC Tax Credit Deadlines
A Quick Recap On The Employee Retention Tax Credit
The Employee Retention Tax Credit (also known as the ERC or the ERTC) is a fully refundable tax credit that provided relief to small business owners during the Coronavirus pandemic. Many businesses that kept employees on their payroll during the pandemic were allowed to claim the credit against employment taxes.
Can You Still Apply For the ERC In 2023?
|Tax Year||ERC Application Deadline|
|2020||April 15, 2024|
|2021||April 15, 2025|
Even though the ERC ended in 2021, eligible small business owners still have time to apply for the ERC credit in 2023.
Businesses that didn’t previously claim the credit in 2020 and/or 2021 can claim the credit retroactively by filing an amended quarterly tax return using IRS Form 941-X.
Currently, the IRS has paused processing new ERC applications — that doesn’t mean you’re out of luck, though. You can (and should) still submit your ERC application if you are eligible — you’ll just have to wait a bit longer as the IRS won’t start processing new claims until after December 31, 2023.
Once the ERC moratorium ends and once the taxpayer files the form for each qualifying quarter, the IRS will process the return and issue a refund by check for the amount of the credit that is due to the business.
However, it is important to note that there are still ERC deadlines for filing these amended tax returns. Businesses that haven’t yet claimed the credit need to be aware of these deadlines so they don’t miss out on the money they are owed.
Will The IRS ERC Pause Affect The ERC Application Deadline?
The IRS’s ERC moratorium, or pause, does not affect the ERC application deadline; it only affects how quickly your application will be processed.
The IRS has paused processing all new applications until after December 31, 2023. Eligible taxpayers can still submit their application; know that the processing time is now upwards of 180 days instead of 90 days.
When Is The ERC Deadline For The Qualifying Period In 2020?
Businesses that didn’t file their claims on their quarterly tax returns in 2020 can fill out form 941-X and submit it to the IRS. The deadline for completing and submitting claims for 2020 ERC is April 15, 2024.
The qualifying period for ERC in 2020 is March 13, 2020, through December 31, 2020. Businesses that paid employees during this time period may be eligible to claim a credit for up to $5,000 per employee for the year.
When Is The ERC Deadline For The Qualifying Period In 2021?
Businesses that didn’t claim the credits on their quarterly tax returns for 2021 can file amended returns to receive this credit as a refund. The deadline for completing and submitting claims for 2021 ERC is April 15, 2025.
The qualifying period for ERC in 2021 is January 1, 2021, through September 30, 2021, for most businesses. Businesses that are classified as recovery startup businesses may be eligible to claim ERC for Q4, which runs from October 1, 2021, through December 31, 2021. Businesses that paid wages to employees may be eligible to claim a credit of up to $7,000 per employee per quarter.
Does Filing The ERC With An ERC Preparer Affect The ERC Application Deadline?
Some business owners don’t have the time to navigate the complexities of filing amended quarterly tax returns. In many cases, these business owners choose to hire one of the top ERC tax credit companies to handle their ERC claims. If your business opts to work with one of these companies, the ERC deadline won’t change, but the timelines for submission and processing may look a little different.
In most cases, an ERC company will need at least one week in order to verify your documentation, complete your amended return, obtain your signatures, and submit your claim to the IRS. However, many ERC companies may take several weeks or longer to complete and process your amended tax returns properly.
Remember that during the ERC pause, these third-party ERC providers can still submit your new application, but you’ll have to wait longer for your refund.
If you opt to work with a third party, it’s imperative that you don’t wait until the last minute. Make sure to discuss all deadlines, from submitting an application to providing your documentation for ERC calculations, so you don’t miss out on receiving your refund.
The Bottom Line On ERC Credit Deadlines
While there is still time to claim your ERC credit, don’t wait until the last minute.
There is plenty of work that goes into claiming your refund, such as determining if you qualify for ERC, gathering your documentation, calculating the amount of your ERC, and filling out Form 941-X, so make sure that you allow yourself enough time to complete these tasks.
Rushing around last minute can lead to errors that can result in processing delays or an inaccurate ERC refund, so don’t wait. Start the process as soon as possible to ensure that your return is postmarked by the IRS deadlines. Good luck!