New Supreme Court Decision Opens the Door for Wineries to Claim Critical Tax Credits

Landmark Ruling in Loper Bright Enterprises vs. Raimondo Removes IRS Barriers to the Employee Retention Tax Credit (ERTC)

San Diego, CA – In a development with significant implications for the wine industry, the U.S. Supreme Court’s recent ruling has nullified IRS-imposed restrictions on the Employee Retention Tax Credit (ERTC) program. This decision paves the way for wineries—from boutique estates to large-scale vineyards—to more easily access crucial tax credits designed to ease payroll burdens during challenging economic times.

Tax attorney Skip Coomber explains, “The Supreme Court’s decision in Loper Bright Enterprises vs. Raimondo has dismantled the IRS rules that previously limited eligibility for the ERTC. This ruling now opens up an accessible path for wineries and other businesses to secure vital financial relief.”

A Game-Changer for the Wine Industry

The decision, handed down on June 28, 2024, in Loper Bright Enterprises vs. Raimondo, Secretary of Commerce, not only overturns the long-standing Chevron doctrine but also mandates that courts must independently assess whether an agency has acted within its statutory authority. As a result, federal agencies, including the IRS, are no longer permitted to impose restrictions that extend beyond the explicit guidelines set by Congress.

For the wine industry, which faced unprecedented operational challenges during the COVID-19 pandemic—from forced closures of tasting rooms to the cancellation of vineyard tours and wine festivals—this ruling is particularly impactful. Under the CARES Act, signed on March 27, 2020, the ERTC was established to help businesses maintain payroll during the crisis.

How Wineries Can Benefit from the Revised ERTC Guidelines

Under the original framework of the CARES Act, wineries had two ways to qualify for the ERTC:

Gross Receipts Test: Eligibility determined by comparing quarterly gross revenues to those in 2019.
Government Orders Test: Qualification for businesses whose operations were fully or partially suspended due to government mandates—such as closures of tasting rooms or restrictions on hosting wine events.
Previously, the IRS added extra layers of difficulty by enforcing:

A Nominal Impact Test requiring at least a 10% operational impact, and
A Supply Chain Restriction that disqualified businesses affected solely by supply chain issues.
With these restrictions now struck down, wineries can potentially qualify for up to $21,000 per W-2 employee for 2021 under the Government Orders Test. This relief offers a much-needed boost to operations, helping wine producers manage payroll, invest in facility upgrades, or expand their production and visitor experiences as consumer demand returns.

Next Steps for Winery Owners

Winery owners who previously hesitated to file for the ERTC due to stringent IRS rules are encouraged to reassess their eligibility in light of the new legal landscape. Engaging with a tax professional experienced in ERTC claims is essential to ensure that every eligible winery secures the full benefits available under the revised program.

About Our Firm

Our firm has a proven track record in assisting over 300 employers, including wineries and other hospitality businesses, in claiming ERTC refunds—resulting in more than $300 million in Treasury checks. We are dedicated to helping businesses navigate complex tax credit regulations and secure the financial relief they need to thrive.

For further information or to schedule a consultation, please go here.