Employee Retention Credit -Voluntary Disclosure Program
Concerned that the Employee Retention Credit (ERC) your business received is improper? For a limited time the IRS is offering a generous voluntary disclosure program to allow Taxpayers to correct this mistake. Through March 22, 2024, the IRS will allow Taxpayers to keep 20% of any improperly received refund if they come forward voluntarily.
Businesses will need to meet five criteria in order to participate in this program:
Have already received an ERC refund.
Businesses that have applied for ERC but have not received the credit due to the IRS moratorium on processing claims will need to participate in the ERC Withdrawal Program.
You now calculate your ERC claim to be $0 for some or multiple quarters.
You are not currently under employment tax examination by the IRS.
You are not under criminal investigation by the IRS.
The IRS has not already reversed or notified you of an intent to reverse your ERC.
Participants in the program will need to (1) pay back 80% of the ERC received, (2) cooperate with the IRS requests for additional information, (3) sign a closing agreement. The IRS will not charge any interest or penalty on the 80% repayment, not require any tax returns to be amended, and not audit the employment tax returns resolved within the terms of the ERC Voluntary Disclosure Program.
The goal of the IRS is likely to gain information on promoters of false credits and allow them to best focus their resources on future audits. The IRS will likely use the information gained in the ERC Voluntary Disclosure program and other sources to audit other clients of the these promoters. For businesses that used a promoter that prepared many ERC claims, the program could be save the business from substantial civil or criminal penalties in the future. For a complete review of your ERC situation from a tax attorney please contact us to discuss your options. You may also call (917)-746-2211.
