The Employee Retention Credit (ERC) is a refundable payroll tax credit established by the federal government to help employers cover the cost of keeping staff employed. To start the ERC credit, employers must file Form 941, the employer's quarterly federal tax return. Some tax advisors are misstating the rules related to the deadlines for employee retention credit (ERC) applications. The ERC can only be filed using IRS Form 941-X, “Adjusted Federal Tax Return or Employer Refund Request.” According to the instructions on the corresponding form, eligible employers can still apply for the ERC for previous quarters by filing an adjusted employment tax return within the deadline set out in the instructions.
This means that amendments can be submitted up to three years after the filing date of each quarterly payroll tax, resulting in a different deadline for applying for the ERC for each calendar quarter. It is important to note that employers must meet all eligibility requirements and file their application within the specified deadline in order to receive the ERC. Employers should consult with their tax advisors to ensure they are aware of all applicable deadlines and requirements.