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Employee Retention Credit to be Repaid Using Form 941

The Infrastructure Investment and Jobs Act (IIJA) signed into law in November of 2021 retroactively ended the Employee Retention Credit (ERC) as of September 30, 2021. Taxpayers who took the ERC for the fourth quarter of 2021 prior to the passage of the IIJA can repay the credit by filing Form 941 “Employer’s Quarterly Federal Tax Return” by its applicable due date.

The IRS also issued guidance on the ERC in IRS Notice 2021-65 released on December 6, 2021. This Notice indicated that Employers could avoid failure to pay penalties for any advance payments of the ERC taken for the 4th quarter of 2021 if they repay these amounts by the due date for their applicable employment tax return covering the fourth quarter. Failure to deposit penalties can also be waived if the deposits were to have been made prior to December 20, 2021, were not made because the employer anticipated being able to take the ERC, and the employer reports the liability from the termination of the ERC on its 4th quarter 2021 tax return. Form 941 for the 4th quarter of 2021 is due on January 31, 2022.

Stuart J. Oberman, Esq.
President & CEO | Website | + posts

Stuart J. Oberman is the founder and President of Oberman Law Firm. Mr. Oberman graduated from Urbana University and received his law degree from John Marshall Law School. Mr. Oberman has been practicing law for over 30 years, and before going into private practice, Mr. Oberman was in-house counsel for a Fortune 500 Company.

Danielle L. Schlaufman McBride, J.D., LL.M.
Partner | Website | + posts

Danielle L. Schlaufman McBride has been practicing law for over 21 years, and her primary focus is representing healthcare clients on a local, regional, and national basis. Ms. McBride regularly consults with clients regarding simple to complex healthcare transitions, including mergers and acquisitions, employment law, governmental compliance, tax strategies, practice valuations, DSO formation and structures, employee compensation, associate and partnership contracts, joint ventures, and partnership buy-in/buy-outs. Read More =>