IRS Renews Warnings on Aggressive Employee Retention Credit Claims

Last week, the IRS issued a renewed warning urging business owners to carefully review the Employee Retention Credit (ERC) guidelines before filing claims.

The credits are legitimate, but the IRS points to promoters who “aggressively mislead people and businesses into thinking they can claim these credits,” as a significant problem. There are many fly-by-night companies out there advertising on the radio and online that push overly-aggressive interpretations of the ERC guidelines in order to claim the credits. When the IRS gets around to auditing those claims, these companies may not be able to be found to assist after they’ve been paid.

If you’re interested in looking into the ERC for your business, reach out to a trusted CPA - someone established who will be around to provide audit support if needed down the road. Above all else, be skeptical about tax savings that seem too good to be true. Ultimately, taxpayers are responsible for the information reported on their tax returns. If the ERC is claimed improperly, the taxpayer may be required to repay the credit along with penalties and interest.

Read the IRS’s full release here: https://www.irs.gov/newsroom/irs-issues-renewed-warning-on-employee-retention-credit-claims-false-claims-generate-compliance-risk-for-people-and-businesses-claiming-credit-improperly.

Schreiber Accounting and Advisory can help you understand whether you qualify for the Employee Retention Credit and help you file the appropriate payroll tax returns to claim it. The Firm has extensive experience with the credit, and will be around for the long term in case any issues arise down the road. Contact the firm for more information.

Material discussed is for informational purposes only. It is not to be interpreted as investment, tax, or legal advice. Individual situations vary, and this information should only be relied upon when coordinated with individual professional advice. Not all taxpayers will receive a refund.