Guidance on the Employee Retention Credit

IRS has issued further guidance on the Employee Retention Credit, including guidance for employers who pay qualified wages after June 30, 2021, and before January 1, 2022.
Notice 2021-49 also provides guidance on several additional issues regarding the employee retention credit for both 2020 and 2021, including:

  • The definition of a full-time employee and whether that definition includes full-time equivalents;
  • The treatment of tips as qualified wages and the interaction with the section 45B credit;
  • The timing of the qualified wages deduction disallowance, and whether taxpayers who already filed an income tax return must amend it after claiming the credit on an adjusted employment tax return; and
  • Whether wages paid to majority owners and their spouses may be treated as qualified wages.