Last month, the Employee Retention Credit (ERC), which was originally enacted in March of 2020 as part of the CARES Act, was extended and expanded through December 31, 2021 under The American Rescue Plan Act of 2021 (“ARPA”).
Employers may file Form 7200, Advance Payment of Employer Credits Due to COVID-19, to obtain refunds of employment taxes which are refundable as a result of these tax credits based on payments to employees for:
- Employee retention wages covered by the CARES Act (more information here.)
- Qualified sick leave wages and qualified family leave wages amended and extended under the ARPA (more information here.)
- COBRA premium subsidy covered by the ARPA
If you want to take advantage of any of the payroll credits provided to employers through the various COVID-19 relief bills, to ensure you receive the maximum credit as soon as possible, we will be filing the Form 7200 on your behalf with each payroll in which the credit owed to you exceeds the amount of 941 taxes due. Form 7200 will only be generated when a refund is owed to your company for that particular payroll.
How to Get Started
If you wish to track wages eligible for the above credits, please contact your payroll specialist to obtain an authorization form, authorizing us to calculate the credits and transmit Form 7200 to the IRS. This must be done before your payroll is processed.
If you have any questions regarding Form 7200 or the filing process, please reach out to your payroll specialist.