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IRS Criminal Investigation to Hold Informational Sessions About Employee Retention Credit for Tax Pros

S.J. Steinhardt
Published Date:
Jan 29, 2024

As the IRS reminded businesses to review their eligibility for the Employee Retention Credit (ERC), its law enforcement arm, Criminal Investigation (CI), will hold a series of educational sessions for tax professionals.

These sessions, which will take place in February in at least 23 states and the District of Columbia, are part of a nationwide initiative to ensure that tax professionals have the latest information about ERC claims and understand ERC eligibility criteria. They sessions are specifically designed for tax professionals who have claimed ERCs for their clients on previous years’ tax returns. Invitations to attend will arrive by mail through the U.S. Postal Service.

“During the COVID-19 pandemic, tax credits and loans were extended to struggling businesses. We’ve seen many of these COVID-relief programs and credits misappropriated—sometimes knowingly and in other instances not,” said IRS CI Chief Jim Lee. “These educational sessions will help tax preparers navigate the complexities of ERC claims to ensure they’re in compliance with U.S. tax laws.”

In September, the IRS imposed a moratorium on the processing of all claims for the ERC through the end of 2023 in response to a proliferation of fraudulent claims. A month later, it established a new process that gave employers the ability to rescind what may have been inaccurate ERC claims and, in December, began disallowing thousands of claims that did not meet the eligibility requirements.

The IRS also established a voluntary disclosure program for businesses that received and deposited refunds after filing erroneous ERC claims. The program, which runs through March 22, allows employers that received questionable ERCs to repay 80 percent of the claim received.

“Our compliance activities involving these payments continue to accelerate, and the IRS urges businesses with concerns about their claims to talk to a reputable tax professional and consider joining one of our special disclosure or withdrawal programs,” said IRS Commissioner Danny Werfel. “We saw aggressive marketing around this credit, and well-intentioned businesses were misled into filing claims. There’s a limited time window available for these businesses to voluntarily come in and avoid future issues.”

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