Employee Retention Credit Documentation Template

EMPLOYEE RETENTION CREDIT DOCUMENTATION TEMPLATE

ERC ELIGIBILITY AND CLAIM SUPPORT PACKAGE

IMPORTANT NOTICE

ERC CLAIMS STATUS (AS OF 2026):

The IRS has been closely reviewing ERC claims due to a significant number of improper claims. The period of limitations for most ERC claims has expired:

• 2020 quarters: Generally expired April 15, 2024
• 2021 quarters: Generally expired April 15, 2025

This template is provided for documentation purposes for claims previously filed or under examination.

EMPLOYER INFORMATION

Employer Name: [LEGAL NAME]

Federal EIN: [EIN]

Address:
[STREET ADDRESS]
[CITY, STATE ZIP]

Business Type:
☐ For-profit business
☐ Tax-exempt organization

NAICS Code: [CODE]

Industry: [INDUSTRY]

Number of Employees (2019 Average): [NUMBER]

Employer Size Classification:
☐ Large Employer (>100 full-time employees in 2019 for 2020; >500 for 2021)
☐ Small Employer (≤100 full-time employees for 2020; ≤500 for 2021)

Contact Person:

• Name: [NAME]
• Title: [TITLE]
• Phone: [PHONE]
• Email: [EMAIL]

SECTION 1: ERC ELIGIBILITY PATH

1.1 Eligibility Basis (Select One for Each Quarter):

SECTION 2: GOVERNMENT ORDER SUSPENSION

2.1 Governmental Orders Documentation:

For each quarter claiming eligibility based on full or partial suspension:

QUARTER: [Q# 20XX]

Order Information:

Order Attachment: ☐ Copy attached

2.2 Impact Analysis:

Nature of Suspension:

☐ Full Suspension - Operations fully ceased due to government order

☐ Partial Suspension - More than nominal portion of operations suspended

Description of Business Operations Affected:
[DESCRIBE WHICH OPERATIONS WERE SUSPENDED OR LIMITED]

Percentage of Business Operations Affected: [%]

How the Order Limited Commerce, Travel, or Group Meetings:
[DETAILED EXPLANATION OF THE ORDER'S IMPACT ON YOUR SPECIFIC BUSINESS]

2.3 Partial Suspension Analysis:

If claiming partial suspension, document "more than nominal" impact:

Safe Harbor: More than 10% impact on gross receipts or service capacity

SECTION 3: GROSS RECEIPTS DECLINE TEST

3.1 2020 Quarters (>50% Decline Required):

Quarter Following Recovery (when receipts exceed 80%):
[QUARTER] - No longer eligible based on gross receipts

3.2 2021 Quarters (>20% Decline Required):

Alternative Prior Quarter Test (2021):
May use prior calendar quarter comparison if current quarter does not qualify:

3.3 Gross Receipts Definition:

Gross receipts include:
☐ Sales of products or services
☐ Interest income
☐ Dividends
☐ Rents
☐ Royalties
☐ Annuities (except certain insurance)

SECTION 4: RECOVERY STARTUP BUSINESS (Q3-Q4 2021)

4.1 RSB Eligibility Requirements:

☐ Business began carrying on trade/business after February 15, 2020
☐ Average annual gross receipts ≤ $1 million (for 3-year period or period of existence)

Date Business Began: [DATE]

Annual Gross Receipts:

4.2 RSB Credit Limit:

Maximum credit per quarter: $50,000
Q3 2021 credit claimed: $[AMOUNT]
Q4 2021 credit claimed: $[AMOUNT]

SECTION 5: QUALIFIED WAGES CALCULATION

5.1 Large Employer (>100 full-time employees) - 2020:

Only wages paid for time NOT worked qualify:

5.2 Large Employer (>500 employees) - 2021:

Only wages paid for time NOT worked qualify:

5.3 Small Employer (≤100 full-time employees for 2020; ≤500 for 2021):

All wages paid during eligible period qualify:

5.4 Per-Employee Limits:

SECTION 6: CREDIT CALCULATION SUMMARY

6.1 2020 Credit Calculation:

6.2 2021 Credit Calculation:

GRAND TOTAL ERC: $[AMOUNT]

SECTION 7: COORDINATION WITH OTHER CREDITS/PROGRAMS

7.1 PPP Loan Coordination:

☐ Employer received PPP loan

• PPP Loan Amount: $[AMOUNT]
• Forgiveness Amount: $[AMOUNT]
• Forgiveness Date: [DATE]

Wages Used for PPP Forgiveness CANNOT be used for ERC:

7.2 Other Credits Coordination:

☐ Work Opportunity Tax Credit (WOTC)
☐ Paid Family and Medical Leave Credit
☐ Research Credit (wages)

Wages used for these credits cannot also be used for ERC.

SECTION 8: FORM 941-X FILING INFORMATION

8.1 Amended Returns Filed:

8.2 Income Tax Adjustment:

The wage deduction must be reduced by the amount of ERC claimed.

☐ Income tax return amended (Form 1120-X, 1065, etc.)
☐ Adjustment made on subsequent year return

SECTION 9: DOCUMENTATION CHECKLIST

Eligibility Documentation:
☐ Copies of governmental orders affecting operations
☐ Documentation of how orders affected business operations
☐ Gross receipts calculation worksheets
☐ 2019 quarterly gross receipts records
☐ 2020 quarterly gross receipts records
☐ 2021 quarterly gross receipts records

Payroll Documentation:
☐ Payroll records for each quarter
☐ Employee lists with wages
☐ Time records (for large employers)
☐ Health plan expense allocation

Credit Calculation:
☐ Qualified wages schedules
☐ Per-employee wage caps applied
☐ Credit calculation worksheets
☐ PPP coordination worksheets

Filing Documentation:
☐ Original Form 941s
☐ Form 941-X copies
☐ Proof of filing/mailing
☐ IRS correspondence
☐ Refund receipts

SECTION 10: CERTIFICATION

Employer Certification:

I certify that to the best of my knowledge:

1. The employer meets the eligibility requirements for the Employee Retention Credit for the quarters claimed
2. The qualified wages and health plan expenses have been accurately calculated
3. No wages claimed for ERC have been used for PPP forgiveness or other credits
4. The documentation supporting this claim has been retained
5. The income tax deduction for wages has been/will be reduced by the ERC amount

Signature: ___________________________________

Printed Name: [NAME]

Title: [TITLE]

Date: [DATE]

IMPORTANT WARNINGS

1. IRS Scrutiny: The IRS is actively auditing ERC claims and has issued thousands of disallowance letters.

2. Period of Limitations: Most ERC claims are now outside the filing period.

3. Third-Party Promoters: Many claims promoted by third parties have been found to be improper.

4. Withdrawal Program: The IRS offered a voluntary withdrawal program for unprocessed claims.

5. Professional Review: Have claims reviewed by a qualified tax professional.

6. Document Retention: Maintain all supporting documentation for at least 7 years.

This template is provided for informational purposes and should be reviewed by qualified tax counsel. Many ERC claims have been found to be improper, and the IRS is actively reviewing claims.