Sometimes, Uncle Sam seems to give with one hand and take with the other. Take the employee retention credit (ERC), for example.
Congress created this tax break in 2020 to help businesses continue to pay their workers following the onset of the COVID-19 pandemic. Then legislators extended the credit, with enhancements, through 2021. However, the new infrastructure act repeals the ERC for the final quarter of 2021.
Fortunately, the IRS has released new guidance to help employers make sense of the repeal. Specifically, Notice 2021-65 explains how the retroactive tax law change applies to employers that have based their deposits on the old law.