Delayed processing times for ERC
Processing times for the Employee Retention Credit are averaging several months per amended 941x return. Depending on how quickly the amended return is processed and how accurate the information provided by the employer is, it can take a minimum of four months for all processing to be completed.
There are also additional steps that can delay this process, such as needing to respond to letters from the IRS or having incorrect information on your return. To help ensure you get your employee retention credit as quickly as possible, be sure to double-check all information on your amended 941x return and respond to any letters from the IRS in a timely manner.
Additionally, consider working with an ERC specialist like American Financial Tax who can provide you with guidance throughout the process. We offer proprietary software that expedites the interview and application process, files quickly, and avoids the delays typical of non-specialist tax preparers and CPA’s who may only process one or two ERC applications per year.
Overall, how long it takes to get your employee retention credit depends on how quickly you can provide the correct information and how accurate all of your documents are. By taking a few extra steps and working with an expert in this field, it is possible to speed up the process significantly and get your ERC sooner than expected. With an experienced tax specialist like American Financial Tax on your side, you can be sure to get the credit you deserve as quickly as possible.
How long to get employee retention credit refund
Once you’ve applied for the Employee Retention Credit and all of your documents have been processed, it may take some time before you receive your refund. In general, it can take anywhere from 8-12 weeks after complete processing of the return to receive the credit refund. Some employers have reported receiving their credit in as little as 4-6 weeks, while others have experienced much longer processing times.
What causes ERC processing delays?
Amended versus original 941
An amended 941x return will require longer processing than an original 941 return. Original 941 returns filed electronically were being processed in less than two months on average, whereas the amended returns take considerably longer.
IRS Backlog
There are a number of factors that are causing delays in processing the Employee Retention Credit applications and amended 941x returns. There is a backlog at the IRS due to the fact that millions of applications have been received, and some of those are paper filings that take longer to process than electronic filings.
Incorrect or Missing Information
Additionally, some applications have incorrect or incomplete information that require additional time for the IRS to review and issue a determination. Some applications may also be subject to an audit by the IRS, which could result in additional processing time. If a letter is sent to the employer requesting more information or clarification, that can also cause delays.
More documentation needed
Final determinations can also be delayed if the IRS needs additional documentation from the employer or if there are any errors on the application. The process for contacting a taxpayer or employer can also lead to delays in receiving a determination.
Multiple quarters amended
Finally, if the credit is being claimed for multiple quarters, the IRS may need additional information to process all of the credit requests. This could result in a longer wait time to get your refund or offset taxes.
Oversized credits
There has been anecdotal reporting online where some accounting firms have claimed that credits exceeding $100,000 in a quarter are also leading to greater scrutiny than smaller credit claims. However, this is not an official IRS policy. Quarterly credit claims greater $100,000 are said to take about 6-8 months for processing. Amended 941x forms with quarterly claims less than $100,000 are estimated to process in less than five months.
Next Step
In order to avoid delays and ensure you get your employee retention credit as quickly and accurately as possible, be sure to provide all the required information with your amended 941x return and respond promptly to any correspondence from the IRS.
Consider working with a tax specialist like American Financial Tax who can help expedite the process by providing guidance throughout the entire application process. With our ERC specialists and proprietary software, we have some of the fastest processing times in the industry.
Call us today to find out why we are the recommended choice of so many employers and CPA firms. We look forward to helping you get the credit you deserve!
