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ISSA Urges Congressional Passage of ERTC Reinstatement Act

ISSA and IOPFDA, a Division of ISSA, joined more than 100 organizations to urge Congress to pass the bipartisan Employee Retention Tax Credit Reinstatement Act (ERTCRA, H.R. 6161/S. 3625). If enacted, the ERTCRA would reinstate fourth-quarter 2021 access to the Employee Retention Tax Credit (ERTC).

In a letter to congressional leaders, the signatories note that “Recent votes on small business aid in Congress are a clear recognition that small businesses and nonprofits in the United States still require financial relief to provide the final push in recovery from economic hardships caused by the COVID-19 pandemic.” The letter goes on to say that “The need for passage has only grown more dire as employers face ongoing supply chain disruptions and increased inflation, making the costs of operating insurmountable in many cases…Small businesses and nonprofits are often referred to as the backbone of the U.S. economy, combined representing nearly 50% of gross domestic product. Immediate action to pass the ERTCRA would allow small employers to turn the page on a tumultuous 26 months and strengthen American competitiveness throughout the world.”

Background

• The ERTC was included in the 2020 CARES Act, which was overwhelmingly supported by both political parties. The ERTC, along with the Paycheck Protection Program (PPP), helped to stabilize small businesses, including those in the cleaning and workplace solutions industries, during the COVID-19 pandemic.
• The ERTC was designed to promote small businesses rehiring employees that businesses may have had to let go at the start of the pandemic or ensure that employees were retained while their companies recovered. While less well known than the PPP, the ERTC was one of the only remaining tools for businesses that continued to be impacted by the pandemic.
• The ERTC was scheduled to expire at the end of 2021, but the Infrastructure Investment and Jobs Act enacted in November 2021 disallowed this credit for the fourth quarter of 2021. Many small businesses continued to take the tax credit into the fourth quarter, and now face a retroactive tax increase and a complex, frustrating process in reconciling the credit that they will now have to forfeit.

Employee Retention Tax Credit Reinstatement Act

• The ERTCRA reinstates the ERTC through the end of 2021, as intended, to help struggling small businesses that were counting on the ERTC to pay their employees through the end of 2021.
• The legislation currently boasts over 100 bipartisan cosponsors across both chambers, including 57 Republicans and 46 Democrats.
• The legislation is supported by nearly 70 small business and nonprofit organizations and is the best viable option to restore much-needed assistance that was previously promised, but subsequently denied.

Please take a moment to tell your congressional delegation to reinstatement the ERTC by visiting the ISSA Advocacy Action Center. For questions regarding the ERTC, please contact ISSA Director of Government Affairs John Nothdurft or IOPFDA Executive Director Mike Tucker.