On September 10, the Small Business Relief Council (SBRC) sent a letter to Congress opposing the proposed early elimination of the Employee Retention Credit.
The Gusto-led SBRC is an unprecedented cross-industry coalition of more than 80 organizations representing millions of small businesses across the country. The SBRC spans different components of the small business financial ecosystem and includes the largest banks, fintech companies, payroll companies, accounting firms, and software companies. The members of the SBRC share a mutual interest in ensuring that small businesses can survive and thrive during the pandemic, in part by providing them effective ways to access government aid.
The letter highlights the importance of the Employee Retention Credit for small businesses and outlines why program changes and delays in IRS guidance contributed to the perception that this important program was significantly underutilized.
The current proposal in the Infrastructure Bill is to end the Employee Retention Credit program on October 1, 2021 before its scheduled end date of December 31, 2021. With variants causing COVID case counts to spike in several states, we could see a repeat of last year when many businesses had to shut down or significantly reduce their operations during the colder months. Gusto’s data suggests that the fourth quarter of 2020 had the highest usage of ERC out of any quarter in 2020. Unfortunately, this program could end in the fourth quarter 2021, just when it is needed the most in 2021. This coalition urges Congress to continue the program through the scheduled end date of December 31, 2021.
Read the full letter here: