ERC Question

Technical topics regarding tax preparation.
#1
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Client thought he was a non-essential business when our shelter-in-place orders went into effect. Two weeks later, as the dust started clearing, he realized he was an essential business and re-opened, though at reduced levels.

During those two weeks he was closed he paid some wages. Would it be fair to take the ERC for those two weeks? He legitimately, closed down thinking he was required to be - not because he wanted to.
 

#2
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no volunatry closure is not make you eligible.
 

#3
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At the time he didn't believe it was voluntary. He shut down only because he understood he was mandated to shut down. There was a lot of confusion back then.
 

#4
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chicagocpa wrote:At the time he didn't believe it was voluntary. He shut down only because he understood he was mandated to shut down. There was a lot of confusion back then.


If he interpreted himself to be subject to a shut down order and ACTUALLY shut down, then I'd be comfortable qualifying under that.
~Captcook
 

#5
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29. If an employer voluntarily suspends operation of a trade or business or reduces hours due to COVID-19, even though that is not required by a governmental order, is the employer eligible to receive the Employee Retention Credit?
An employer that voluntarily suspends operation of a trade or business or reduces hours and is not subject to any governmental orders that restrict its operations is not eligible for the Employee Retention Credit on the basis of a full or partial suspension of its operations due to a governmental order. However, an employer that voluntarily suspends operations due to COVID-19 may be eligible for the Employee Retention Credit if it experiences a significant decline in gross receipts.

https://www.irs.gov/newsroom/covid-19-r ... redit-faqs
 


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