ERC 941 tax credit

Employee Retention Credit Update

Because of the predatory practices by many “pop up companies” targeting small businesses with claims of getting $$$ from the IRS, small-business owners worried about being hit with an audit over their Employee Retention Credit claim, now have a way to back out.

Marketers and scammers have already revised their ERC pitches following the Sept. 14 moratorium announcement. Some are pushing employers who submit an ERC claim into agreeing to costly up-front loans in anticipation of a refund. The IRS urges taxpayers to avoid these loans and also learn the warning signs of ERC scams.

The goal is to offer small-business owners a way out if they feel they had been tricked or pressured into filing a misleading or ineligible claim — with withdrawn claims being treated as if they were never filed.

The IRS said it will continue to process ERC claims made before Sept. 14, 2023 but warned the processing times will be longer as they review them for fraud. That means a standard processing time of 90 days will double to 180 days or longer. There were more than 600,000 claims currently awaiting processing, according to the IRS in September.

The new withdrawal process follows the Sept. 14 announcement of an immediate moratorium on processing new ERC claims. The moratorium, which will last until at least the end of this year, follows a flood of ineligible ERC claims. Payouts for claims submitted before Sept. 14 will continue during the moratorium period but at a slower pace due to more detailed compliance reviews.

The ERC was originally designed to reward business owners that kept staff on their payrolls during the Covid-19 pandemic, and businesses were eligible to receive up to $26,000 per employee.

Tax help for construction, medical, legal and dental
Our team at Roper Accounting Group has over 160 years of accounting and business experience.

Maribeth Christensen, CPA, is here to help with any questions about an ERC that you have filed or if you are considering filing your 941’s before December 31, 2023.

Give Roper Accounting Group a call at 919-844-6111 to set up an appointment.

Maribeth Christensen, CPA Owner and President of Roper Accounting Group

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