![](\"https:\/\/s3.amazonaws.com\/snd-store\/a\/92007053\/10_26_23_2049590303_etra13_560x292.jpg\")
<\/p>\n<\/p>\n
Recent IRS warnings and announcements regarding the Employee Retention Tax Credit (ERTC) have raised some businesses\u2019 concerns about the validity of their claims for this valuable, but complex, pandemic-related credit \u2014 and the potential consequences of an invalid claim. In response, the IRS has rolled out a new process that certain employers can use to withdraw their\u00a0claims.<\/p>\n
Fraudsters jump on the ERTC<\/strong><\/p>\n The ERTC is a refundable tax credit intended for businesses that 1)\u00a0continued paying employees while they were shut down due to the pandemic in 2020 and 2021, or 2)\u00a0suffered significant declines in gross receipts from March\u00a013, 2020, to December\u00a031, 2021. Eligible employers can file claims until April\u00a015, 2025 (on amended returns), and receive credits worth up to $26,000 per retained employee.<\/p>\n With such potentially large payouts, fraudulent promoters and marketers were quick to rush\u00a0in with offers to help businesses file claims in exchange for fees in the thousands of dollars or for a percentage of any refunds received. The requirements for the credit are strict, though, and the IRS has found that many of these claims fall short of meeting\u00a0them.<\/p>\n Invalid claims put taxpayers at risk of liability for credit repayment, penalties and interest, in addition to the promoter\u2019s fees. And promoters may leave out key details, which could lead to what the IRS describes as a \u201cdomino effect of tax problems\u201d for unsuspecting employers.<\/p>\n The IRS responds<\/strong><\/p>\n The wave of fraudulent claims has produced escalating action from the IRS. In July\u00a02023, the agency announced that it was shifting its ERTC review focus to compliance concerns, with intensified audits and criminal investigations of both promoters and businesses filing suspect claims. Two months later, it imposed a moratorium on the processing of new ERTC\u00a0claims.<\/p>\n The moratorium, prompted by \u201ca flood of ineligible claims,\u201d will last until at least the end of\u00a02023. The processing of legitimate claims filed before September\u00a014 will continue during the moratorium period but at a much slower pace. The IRS has extended the standard processing goal of 90\u00a0days to 180\u00a0days and potentially far longer for claims flagged for further review or\u00a0audit.<\/p>\n According to the IRS, though, the moratorium isn\u2019t deterring the scammers. It reports they\u2019ve already revised their pitches, pushing employers that submit ERTC claims to take out costly upfront loans in anticipation of delayed\u00a0refunds.<\/p>\n Now, the IRS has unveiled a new withdrawal option for eligible employers that filed claims but haven\u2019t yet received, cashed or deposited refunds. Withdrawn claims will be treated as if they were never filed, so taxpayers need not fear repayment, penalties or interest. (The IRS also is developing assistance for employers that were misled into claiming the ERTC and have already received payment.)<\/p>\n The withdrawal option is available if\u00a0you:<\/p>\n The exact steps vary depending on your circumstances, including whether you filed your claim yourself or through a payroll provider, have been notified that you\u2019re under audit, or have received a refund check that you haven\u2019t cashed or deposited. Regardless of the applicable procedure, your withdrawal isn\u2019t effective until you receive an acceptance letter from\u00a0the\u00a0IRS.<\/p>\n Taxpayers that aren\u2019t eligible for the withdrawal process can reduce or eliminate their ERTC claim by filing an amended return. But you may need to amend your income tax return even if your claim is withdrawn.<\/p>\n Seek help<\/strong><\/p>\n Throughout its warnings about potential ERTC pitfalls, the IRS has continued to urge taxpayers to consult \u201ctrusted tax professionals.\u201d If you\u2019re having second thoughts about your ERTC claim, we can help you review your claim and, if appropriate, properly withdraw\u00a0it.<\/p>\n \u00a9 2023<\/em> \u00a0<\/p>\n <\/body> Recent IRS warnings and announcements regarding the Employee Retention Tax Credit (ERTC) have raised some businesses\u2019 concerns about the validity of their claims for this valuable, but complex, pandemic-related credit \u2014 and the potential consequences of an invalid claim. In response, the IRS has rolled out a new process that certain employers can use to […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7,59,10],"tags":[8,11,12],"class_list":["post-16752","post","type-post","status-publish","format-standard","hentry","category-articles","category-etra","category-news","tag-articles","tag-news","tag-updates"],"_links":{"self":[{"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/posts\/16752","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/comments?post=16752"}],"version-history":[{"count":1,"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/posts\/16752\/revisions"}],"predecessor-version":[{"id":16753,"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/posts\/16752\/revisions\/16753"}],"wp:attachment":[{"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/media?parent=16752"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/categories?post=16752"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/tags?post=16752"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}\n
\n<\/html><\/p>\n","protected":false},"excerpt":{"rendered":"