On December 15th, the Internal Revenue Service issued an early release draft of instructions for IRS Form 6765 entitled “Credit for Increasing Research Activities”, to properly reflect legislation regarding the determination of qualified wages that impacts Lines 5 and 24 from the December of 2020 revision.
It should be duly recalled, pursuant to legislation enacted in December of 2020, wages for qualified services do not include:
- Wages paid to or incurred for any employee after December 31, 2020 and before July 1, 2021, if the employer uses the same wages to claim the Employee Retention Credit (“ERC”) on an employment tax return such as IRS Form 941 entitled “Employer’s Quarterly Federal Tax Return”; and
- Wages paid to or incurred for any employee generally after December 27, 2019 and before April 17, 2021, if the employer uses the same wages to claim the 2020 qualified disaster ERC on IRS Form 5884-A entitled “Employee Retention Credit for Employers Affected by Qualified Disasters”.
As a reminder, do not file draft forms and do not rely on draft forms, instructions, and / or publications for filing until finalized by the Service. The draft instructions for IRS Form 6765 can be reviewed at https://www.irs.gov/pub/irs-dft/i6765--dft.pdf The Service is also currently accepting comments in connection to the draft instructions at https://www.irs.gov/forms-pubs/comment-on-tax-forms-and-publications All tax filing forms and instructions are expected to be finalized by the Service before the end of January 2022.
About the Author
Peter J. Scalise serves as the Federal Tax Credits and Incentives Practice Leader for the Americas at Prager Metis CPAs, LLC, a member of the Prager Metis International Group. Mr. Scalise is a highly distinguished Big Four Alumni Tax Practice Leader with approximately thirty years of progressive public accounting firm experience developing, managing, and leading multi-million-dollar tax advisory practices on a regional, national, and global level.
Mr. Scalise is also a prominent philanthropist who champions many charities nationwide in connection to poverty and hunger alleviation; economic development; health and social services; veteran and military service personnel along with preserving arts and cultural programs. Mr. Scalise is currently serving on the National Board of Directors for the Prager Metis Charitable Foundation Inc, a I.R.C. § 501(c)(3) organization and is the Founding Chairman of the Accounting Industry Leadership Council to benefit the Alzheimer’s Association. Mr. Scalise is the former Manhattan Event Chairman and Sponsorship Chairman for the Alzheimer’s Association’s annual signature fundraising event entitled “The WALK to END ALZ” at the historic South Street Seaport District.
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