Key insights
- The IRS uncovered many improper claims during its moratorium.
- The IRS is prioritizing smaller, low-risk claims for employers and has started making payments on claims filed prior to and during the moratorium.
- The IRS is again helping employers repay improper credits with a voluntary disclosure program.
Need assistance with an ERC claim? Check out our office hours.
The IRS recently updated taxpayers on its plans for processing employee retention credit (ERC) claims in the coming months. It’s releasing over 50,000 payments in the coming weeks with more planned payments for low-risk claims in the fall. Additionally, the IRS is processing claims filed during the moratorium period which began on September 14, 2023.
In a news release, the IRS indicated it completed a detailed review of high-risk claims filed by aggressive marketers and plans to deny tens of thousands of inappropriate filings.
As a balance to this plan, the IRS recognized the importance of prioritizing and processing claims for small businesses with low-risk claims who are legitimately awaiting funds.
“The Employee Retention Credit is one of the most complex tax provisions ever administered by the IRS, and the agency continues working hard to balance our work to protect taxpayers from improper claims while also making payments to qualifying businesses,” said IRS Commissioner Danny Werfel.
On September 14, 2023, the IRS initiated a moratorium on processing new claims so it could digitize and review queued claims — and seek input from Congress and others on an appropriate approach to the higher risk areas. IRS Commissioner Danny Werfel indicated they plan to keep the moratorium in place — even though claims are still coming in at an average rate of 17,000 a week.
Currently, more than 450 criminal investigations are underway for fraudulent claims, thousands of IRS audits are in process, and the IRS is contemplating civil and criminal action against promoters.
While there’s no action required of taxpayers at this time, those who have not received funds but believe their claims are improper may still withdraw their claims for refund.
The IRS has reopened the voluntary disclosure program for employers who believe they were improperly advised by a solicitor and would like to return their funds
How we can help
CLA can help you understand the risk associated with your ERC claim and whether you have an opportunity to revisit your eligibility. We can answer your questions and help with filing, amending, and withdrawing claims.
We’re holding ERC office hours August 21 at noon CT. RSVP here with your name, email, and any questions you have so we can send you a link to a Teams meeting.
We’ll answer the most common fact patterns using the statute, IRS notices, and guidelines available. If you need a more specific consultation, reach out to your CLA advisor.
Contact us
If you think you were misinformed and would like to return funds, reach out for guidance. Complete the form below to connect with CLA.
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