This week's tax highlights include additional ERC guidance and clarification, carried interests and gross receipts.
Earlier this year, the IRS issued two notices, 2021-20 and 2021-23, attempting to provide guidance on the Employee Retention Credit (“ERC”). The current notice clarifies some of the earlier issued guidance and attempts to answer questions not previously addressed.
The so-called carried interest “loophole” has been a target of many presidential candidates and legislators. President Biden campaigned on closing it as part of his plan to raise taxes on those making more than $400,000.
It should ordinarily be obvious that if something isn’t part of gross income is shouldn’t be considered part of gross receipts. When it comes to the Employee Retention Credit (“ERC”) however, nothing is obvious.