ARA pushes for reinstatement of the Employee Retention Tax Credit

The American Rental Association (ARA) recently joined dozens of charitable nonprofits and trade associations in sending a letter to the president and key members of Congress asking for the Employee Retention Tax Credit (ERTC) to be restored.

The letter — sent to President Joe Biden; Speaker of the House Nancy Pelosi; House Minority Leader Kevin McCarthy; Senate Majority Leader Charles Schumer; and Senate Minority Leader Mitch McConnell — expresses the following concern for small businesses in need of the ERTC:

“Each new coronavirus variant brings new restrictions affecting the small businesses our members own and operate, as well as charitable organizations throughout the country. Further worsening this problem was the cancellation of the Employee Retention Tax Credit for the fourth quarter of 2021 as part of the Infrastructure Investment and Jobs Act (P.L. 117-58).

With most recipients having long since expended their Paycheck Protection Program (PPP) loans, if available to them at all, the employers and members we represent were counting on the ERTC as one of the few financial support programs during the pandemic that enabled America’s employers to keep employees on the payroll. Many small businesses and charitable nonprofits continued to take the tax credit into the fourth quarter, which started six weeks before the infrastructure bill was signed into law, and now face a retroactive tax increase and a complex, disruptive process of reconciling the credit that they will now have to forfeit.

Just as businesses began resuming operations, new variants caused an increase in cases throughout the nation, compounding business disruptions and prolonging recovery. Ending the ERTC early – amid an extraordinarily challenging business environment – froze the process of rehiring furloughed employees, caused employers to consider additional layoffs, and made it impossible for small employers to forecast financial solvency into the new year.

On behalf of the small businesses and organizations we represent, the employees who rely on them for their livelihoods, and the communities we serve, we urge you to restore the ERTC through the end of the year, as laid out in the recently introduced Employee Retention Tax Credit Reinstatement Act (H.R. 6161). This bipartisan piece of legislation currently boasts nearly 40 bipartisan cosponsors and over 50 endorsing organizations.”

Click here to read the full letter.