Episode Notes

• The IRS recently stopped processing Employee Retention Tax Credit (ERTC) claims.
• What Is the ERTC?
  • The ERTC was introduced back during COVID.
  • It was a pandemic related tax credit that offered money back or help to employers who continued to retain their employees during the middle of COVID.
  • During certain quarters of 2020 and 2021, small businesses were eligible for this credit if they were partially or fully shut down by a COVID lockdown or restriction.
  • They were also eligible if they had a revenue loss, depending on the quarter.
  • This means, as a business owner, you could go back and amend your payroll tax returns and claim a credit against the payroll taxes you paid. If the credit was bigger than the taxes you paid, the government would give you money back as a refundable tax credit.
• Why Has the IRS Stopped Processing Claims for This Credit?
  • Less desirable firms are taking advantage of this credit.
  • These firms have been calling and sending out emails stating you can get millions of dollars back from the government.
  • This has proliferated to the point where the IRS is stopping the processing of claims for the ERTC credit.
  • The IRS is now investigating and getting to the bottom of these claims.
• What Does This Mean If You’ve Submitted a Claim?
  • If you’ve submitted a claim or amended your return so that you can take advantage of the credit and received your refund, you have nothing to worry about, as long as everything is legitimate.
  • If you’re concerned about if it was legitimate or if you were truly eligible, you should go to a tax professional or your payroll service company and have them review the amended return you used to get the refundable tax credit. They can tell you if it was legitimate or not.  
  • If your claim is found to not be legitimate, you can file to withdraw the claim and return the money.

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