For 2018, a company isn’t eligible for the payroll tax offset if it had gross receipts prior to 2014 (more than five years of gross receipts ending with the 2018 credit year). However, if the company was formed prior to 2014 and did not have any gross receipts in those years then it could qualify for the payroll tax credit. This scenario is possible in certain industries such as Life Sciences.
Note that the definition of gross receipts includes total sales (net of returns and allowances), receipts received for services, as well as interest, dividends, rents, royalties and annuities. Additionally, there is currently no de minimis test for gross receipts. Thus, even a nominal amount of bank interest reported on a tax return prior to the five-year period ending with the credit year could preclude a taxpayer from claiming the payroll tax offset.