When is the operation considered suspended?
There are two types of suspended businesses: full and partial. A fully-suspended business generally cannot operate at all due to government orders. A partially-suspended business means that the operations of a business are limited by government orders but may still operate in a modified capacity. Many businesses, including restaurants, bars, gyms, schools, real estate brokers, medical practices and others were partially suspended in 2020 and 2021 and can be eligible for the ERC.
A classic example of a partially suspended business is a full-service restaurant that was prevented from serving customers indoors or had to reduce seating capacity for 2020 and/or 2021. Even if that restaurant could serve customers outdoors or with takeout and delivery services, that restaurant could be considered partially suspended. If your company faced a similar modification, it could qualify under the partial suspension rules.