A coalition of small business groups is urging Congress to extend by 90 days the proposed cut-off of employee retention tax credit (ERTC) claims. The Coalition to Preserve American Jobs is arguing that cutting off claims on January 31 would be “slamming the door on many eligible small business owners” right as the tax filing season begins.

The January 31 date, after which ERTC claims could no longer be submitted, is included in the pending $78 billion tax bill, H.R.7024. The ERTC provision is an offset to the cost of the tax bill and is targeted at what many are calling “overwhelming fraud” in the ERTC arena. The ERTC provisions in the tax bill would also impose stiff new penalties on promoters of the ERTC.

The coalition is asking for a delay in the effective date of the ERTC cut-off to 90 days after the enactment of the tax bill.

Prospects: There is some concern among lawmakers about the adverse impact of the cut-off of ERTC claims on “innocent taxpayers.” However, between outrage over the “rampant fraud” in the ERTC arena, and the need to avoid adding to the federal deficit by not offsetting the cost of the tax bill, chances for delay in the effective date are minimal.

NAIFA Staff Contacts: Jayne Fitzgerald – Director – Government Relations, at jfitzgerald@naifa.org.