How do I record Employee Retention Credit (ERC) received in QB?

vaughnn · ‎June 27, 2023

I'm having the same issue. No one seems to be addressing this in the thread. I received the ERC in 2022 for the years 2020 and 2021. Once I received this amount, I had to amend my 2020 and 2021 tax returns to reflect the decrease in payroll tax expense, therefore, increasing my income. By amending my returns, I have accounted for the decrease in my expenses for those tax years.

However, in my book currently, the amount deposited in 2022 is now seen as income in 2022. How do I rectify this? I need to zero out these deposits which are currently showing as income. These deposits are affecting my P&L and balance sheet for 2022. I'm thinking of journal entry but do not have a clue on which account to post to.

MGilbert6 · ‎July 06, 2023

One would think the books are adjusted in 20/21 to reflect reduce payroll expense. This reduction creates a payroll liability credit in 20/21......in effect, you'll have a payroll tax receivable for those years which is eliminated when received in 2022.

sz64 · ‎May 03, 2024

wouldnt claiming it as other income in year check received create taxable income that was already taxable in the year the erc credit was applied for, as you have to go back and file amended returns therefore reducing expenses in the applicable year?

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