Under PPP, loan recipients can apply for forgiveness if they use at least 60% of the proceeds for wages and the remaining funds for other eligible expenses, including rent or mortgage, utilities, among other operating costs.
Given the short time frame for submitting the 4th quarter return, companies opting to take the credit can use an adjusted filing later in the year instead.
“We understand this might be difficult to implement so late in the timeframe to file your 4th quarter return,” the IRS said. “You can instead choose the regular process of filing an adjusted return or claim for refund for the appropriate quarter to which the additional ERC relates using Form 941-X.”
