National Restaurant Association and state partners warn IRS that ERTC filing backlog is creating cash flow problems for restaurants

Washington, DC – The National Restaurant Association and the 52 State Restaurant Associations today sent a letter to Treasury Secretary Janet L. Yellen and Internal Revenue Service (IRS) Commissioner Charles P. Rettig urging the IRS to improve the filing process for the Employee Retention Tax Credit (ERTC). The recommendations outlined in the letter are intended to provide restaurants with more certainty and flexibility this tax season.

The letter points out that many restaurants have applied for the ERTC but still have not received help. A recent survey found that 83% of operators who applied for the tax credit more than six months ago have still not received funds. Additionally, the letter points out that this issue is “compounded by a loss of their normal payroll tax deduction on their 2021 tax return,” creating a cash flow problem, as some restaurant owners will not have received the corresponding credits. when they have to file and pay taxes.

“The ERTC has been a critical recovery tool for hundreds of thousands of restaurants, but far too many are still waiting for reimbursement from the federal government,” said Sean Kennedy, executive vice president of public affairs at the National. Restaurant Association. “As tax day approaches, many restaurants are about to be told to overpay their taxes, with the promise of a refund later. The system may work better for an industry on the ropes, and we urge the IRS and Treasury to act on our common sense solutions.

To provide more certainty for restaurants this filing season, the letter urges the IRS to:

  • Stop automated collections, including lien/levy issuance, until the IRS can certify that the Form 941 backlog has been resolved.
  • Delay the collection process for filers until any mail that may include a request for a reduction is processed.
  • Simplify the reasonable cause penalty abatement process for taxpayers impacted by the COVID-19 pandemic without the need for written correspondence.
  • Communicate the status of amended returns and ERTC refunds, including expected dates for processing tax documents.

Read the full letter to the IRS.

About the National Restaurant Association

Founded in 1919, the National Restaurant Association is the leading trade association for the restaurant industry, comprising 1 million food and beverage outlets and a workforce of 15.6 million employees. We represent the industry in Washington, DC and advocate on its behalf. We sponsor the largest trade show in the industry (National Restaurant Association Show); leading food safety training and certification program (ServSafe); unique high school career development program (ProStart from NRAEF). For more information, visit and find us on Twitter @WeRRestaurantsFacebook and YouTube.

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