The Employee Retention Credit (ERC) has emerged as a beacon of financial relief for businesses battered
by the COVID-19 pandemic, and now, with the IRS moratorium lifted, a renaissance of ERC claims is
underway. Introduced as part of the CARES Act in 2020, this refundable tax credit was designed to
reward employers who kept workers on payroll during economic upheaval. For a time, a surge of
fraudulent claims stalled its momentum, leading to a processing freeze in September 2023. But with that
pause now history and a supportive new IRS Commissioner at the helm, businesses have a golden
opportunity to embrace this credit before the looming April 15, 2025, deadline for 2021 claims. This
resurgence marks a pivotal moment for companies seeking to reclaim funds and bolster their recovery.
A Recap of the ERC’s Journey
The ERC offers substantial benefits: up to $5,000 per employee for 2020 and up to $7,000 per employee
per quarter for the first three quarters of 2021—a potential total of $26,000 per worker. Eligibility
hinges on two key triggers: a significant revenue drop (50% in 2020 or 20% in 2021 compared to the
same quarter in 2019) or operational disruptions tied to government orders, such as shutdowns or
capacity limits. Industries like hospitality, retail, construction, and transportation—sectors hit hard by
pandemic restrictions—stand to gain the most.
Yet, the ERC’s path hasn’t been smooth. By 2023, the IRS was inundated with dubious claims, prompting
a moratorium that left legitimate applicants in limbo. Skepticism grew, and many businesses hesitated,
unsure if their claims would ever see daylight. That uncertainty has now dissipated, ushering in a
renewed era of optimism.
The Moratorium’s End and a New Champion
The lifting of the moratorium in late 2024, coupled with the appointment of Billy Long as IRS
Commissioner, has breathed fresh life into the ERC program. Long, known for a pragmatic approach, has
prioritized clearing the backlog of valid claims while cracking down on fraud. This shift has restored
confidence, signaling to businesses that the IRS is ready to process and pay out legitimate ERC refunds.
For companies that held off during the freeze, this is a green light to act—provided they move quickly.
Why the Renaissance Matters
The ERC’s revival couldn’t come at a better time. Inflation, supply chain woes, and labor shortages
continue to squeeze businesses, making every dollar count. For a small firm with 10 employees, a full
2021 claim could yield $210,000—money to offset rising costs, invest in growth, or stabilize cash flow.
Larger operations with dozens or hundreds of workers could see millions, transforming their financial
outlook. This renaissance isn’t just about recovery; it’s about resilience.
However, the clock is ticking. The deadline for amending 2021 payroll tax returns (Form 941-X) is April
15, 2025, following the 2020 cutoff of April 15, 2024. With less than two months remaining, urgency is
paramount. Filing requires precision—documenting eligibility, calculating wages, and proving
disruptions—which demands time and expertise.
Seizing the Moment
Businesses should start by assessing their 2021 experience. Did government mandates halt operations
or curtail capacity? Did revenue falter compared to 2019? If either applies, the ERC is within reach. Next,
compile payroll records and consult a tax professional or ERC specialist to ensure accuracy. The post-
moratorium landscape favors diligence, not haste—errors could trigger audits or delays.
A Future Built on Relief
The ERC renaissance is more than a bureaucratic shift; it’s a lifeline for businesses still rebounding from
pandemic scars. Whether you run a restaurant, a factory, or a trucking company, this credit can pave the
way to stability. Don’t let hesitation stall your claim. Embrace this renewed chance, file your ERC before
April 15, 2025, and turn past struggles into present strength.
