The ERC is extremely complex and has been updated multiple times by Congress. Furthermore, the Internal Revenue Service has provided limited guidance on the ERC. As such, in considering the applicability of the ERC to your organization, below is a short list of key considerations that must be taken into account in your evaluation and analysis:
- Number of full time employees;
- Owner employees / relatives of owner employees;
- Common ownership rules / other business interests;
- Paycheck Protection Loan Proceeds;
- Full or partial suspension of business activities (understanding these rules and how you may qualify);
- Definitions of revenue (items to be included / excluded);
- Proper documentation to substantiate governmental audit