Are Tribal Governments And Tribal Entities Eligible For The Employee Retention Credit?

Question #3
Are tribal governments and tribal entities eligible for the employee retention credit?

Found under the A. Eligible Employers section of the Employee Retention Credit (ERC) IRS Notice 2021-20 with updated guidance to help business owners follow the current ERC rules.

The answer to question #3, Are tribal governments and tribal entities eligible for the employee retention credit?, can be found below.

Table of Contents

ERC IRS Notice 2021-20 Question #3:

A. Eligible Employers

Yes. Any tribal government or tribal entity that operates a trade or business may be an eligible employer for purposes of the employee retention credit if it otherwise satisfies the eligibility requirements to claim the credit. As a general rule, whether activities constitute a trade or business for purposes of the employee retention credit is determined under section 162 of the Code.

However, because tribal governments are not subject to income tax under the Code and, therefore, are generally not otherwise required to determine whether an activity of the tribe constitutes the carrying on of a trade or business under section 162, the Treasury Department and IRS have concluded that the section 162 standards are not the appropriate bases for determining whether a tribal government is carrying on a trade or business for purposes of the employee retention credit.

Instead, solely for purposes of the employee retention credit, a tribal government is treated as carrying on trade or business activities, and all activities conducted by the tribal government will be considered part of such trade or business activities, without the need for further analysis of whether those activities meet a particular standard for identifying trade or business operations. In addition, solely for purposes of the employee retention credit, any entity that a tribal government reasonably believes shares the same tax status as the tribal government (tribal entity employer) may also consider all of its activities as trade or business activities.

Any entity other than a tribal government or a tribal entity employer must determine whether its activities constitute carrying on a trade or business under section 162 for purposes of determining eligibility for the employee retention credit.

For more information about the Employee Retention Credit (ERC) IRS Notice 2021-20, visit the Internal Revenue Service (IRS) Department of the Treasury, official IRS.gov tax website.

Conclusion and Summary on Are tribal governments and tribal entities eligible for the employee retention credit? – #3 ERC IRS Notice 2021-20

The answer to Question #3: “Are tribal governments and tribal entities eligible for the employee retention credit?” was answered in detail above. It was found under section “A. Eligible Employers” in IRS Notice 2021-20.

Leave a comment below if you have further questions on the Employee Retention Credit (ERC) or for clarifications on Are tribal governments and tribal entities eligible for the employee retention credit?

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Cover Image Credit: Irs.gov / IRS Notice 2021-20 / Disaster Loan Advisors.

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Mark Monroe

Senior Advisor, Employee Retention Tax Credit (ERC / ERTC) Division at Disaster Loan Advisors™

Mark Monroe is one of the distinguished Senior Advisors of the Employee Retention Tax Credit (ERC / ERTC) Division at Disaster Loan Advisors™, bringing deep expertise and a proven track record in helping businesses safely navigate and maximize benefits from the ERC Tax Credit, for those businesses that do qualify. His role involves a sophisticated understanding of the tax credit’s legislative framework and the updated changes of intricacies involved in securing these critical financial advantages for companies affected by past tax year economic challenges.

As a leading dedicated member of the Tax and Accounting Team at Disaster Loan Advisors™, Mark focuses on unlocking the ERC Tax Credit's potential for eligible firms that qualify, providing strategic advice, and detailed guidance to ensure substantial financial recovery and growth. His methodical approach to client engagement includes comprehensive deep-dive analysis, customized consultation and guidance, and a commitment to achieving tangible results for each business served.

Disaster Loan Advisors™ (DLA) offers a comprehensive suite of services designed to navigate the complexities of the Employee Retention Tax Credit (ERC) program, ensuring that qualified businesses leverage the maximum possible benefit with minimum hassle. Unlike some firms that charge exorbitant contingency or percentage-based fees (often between 10% to 30% of your ERC refund), DLA operates on a fair and reasonable, transparent flat-fee structure that aligns with the IRS's guidelines.

If you are looking for an ERC Company that believes in providing professional ERC Services and value for small business owners, in exchange for a fair, reasonable, and ethical fee for the amount of work required, Disaster Loan Advisors™ is a good fit for you. STAY SAFE. STAY COMPLIANT. KEEP MORE OF YOUR REFUND.™

Employee Retention Tax Credit ERC, ERTC, IRS + SBA News

Are Tribal Governments And Tribal Entities Eligible For The Employee Retention Credit? – #3 ERC IRS Notice 2021-20

ERC IRS Notice 2021-20 Question #3:

A. Eligible Employers