You should create an amended Form 941-X correcting the error or multiple 941-Xs correcting the errors (Yes, this could mean that you are filing a 941-X amending a prior 941-X – no problem).
Yes. And this includes those real estate rentals that you treat as businesses rather than as passive investments.
You have until March 15, 2024 to amend the 2020 S corporation return. You could amend now, but we recommend waiting until you receive the ERC monies, for two reasons:
For the July 1, 2019, company, you use the gross receipts from the third quarter of 2019 as the gross receipts for quarters one, two, and three, and the gross receipts of the fourth quarter of 2019 for the fourth quarter.
No, no, no. First, the ERC for a shutdown applies only to the time of the shutdown. Thus, there’s likely no full quarter for Q4 in your question. For example, if you were shut down for three weeks in Q4, you can qualify for the ERC under the shutdown rules for those three weeks only.
You have one week of qualification under the shutdown order. But you may have much more should you qualify under the decline-in-gross-receipts test.
No, for the government-ordered shutdown, you have three possibilities for determining the effect:
The IRS says this is a facts-and-circumstances test. To use this safe harbor means you need a reasonable basis that demonstrates a 10 percent or more reduction in your ability to provide goods or services.
Production volume and unit sales seem like good candidates to demonstrate the effect of the government order that modified your ability to provide goods and services.
No. It’s the effect the COVID-19 government shutdown order had on your business’s ability to provide goods and services because it could not obtain the rubber.
Possibly, but unlikely. Without a shutdown order, you have to compare the gross receipts quarter by quarter to those in 2019. You need a drop of more than 50 percent in 2020 and a drop of more than 20 percent in 2021 to trigger any ERC.
You determine nominal effect by looking back at the 2019 numbers, and if the shutdown action affected not less than 10 percent of the quarterly revenues or hours of work, you earn the ERC for the time of the shutdown.13 For this test, you are not looking at 2020 or 2021. You look at 2019.
So, yes, you can qualify for the ERC even with larger profits and revenues.
First, yes, you do qualify, because the ERC is based on Section 448(c) of the tax code, and that uses your tax accounting method.
Now that you know you qualify, you have two choices: