Key legislators may be eyeing a reinstatement of the Employee Retention Credit (ERC) — a pandemic relief program cut short last fall. Sens. Maggie Hassan (D-N.H.) and Tim Scott (R-S.C.) introduced bipartisan legislation last week to restore the credit for the fourth quarter of 2021.

The ERC was a refundable payroll tax credit aimed at helping organizations keep staff employed in the midst of hardships stemming from the COVID-19 crisis. Hassan called it a “lifeline” and Scott said it was a “crucial mechanism” for hanging on to workers.

“Providing stability and certainty should be a key consideration in any legislation impacting entrepreneurs and workers, which is needed now more than ever as they power our economic recovery,” Scott added.

Originally included in the CARES Act of March 2020, the ERC was modified several times in subsequent legislation. Notably, the American Rescue Plan, a $1.9 trillion stimulus package pushed through Congress early in President Joe Biden’s term, set the ERC to run through the end of 2021 providing $7,000 per employee per calendar quarter for eligible organizations. However, plans changed for the ERC in November when Congress curtailed the program for most employers one quarter early to help pay for last year’s trillion-dollar infrastructure package.

The Hassan-Scott bill to reverse that decision follows similar bipartisan legislation introduced in the House of Representatives by Rep. .Va.) in December. And the idea appears to be attracting attention. Not only is Senate Small Business Committee Chairman Ben Cardin (D-Md.) a cosponsor of the bill, but Sen. Ron Wyden (D-Ore,) the top Democrat on the powerful Finance Committee, is also reportedly interested.

While it is unclear how broad support is for this measure, action could come as part of a larger package such as government-funding legislation or an “extenders bill” for a broad array of tax provisions that expired at the end of 2021. ECFA will continue to monitor this tax provision closely.