Only a few weeks remain to take advantage of the Internal Revenue Service (“IRS”) offer to allow taxpayers to avoid civil and or criminal liability by repaying Employee Retention Credit (“ERC”) payments to which they were not entitled. The IRS believes that fraudulent promotors duped thousands of taxpayers into applying for and receiving ERC funds for which they did not qualify. Many of these taxpayers have already paid substantial sums to these promoters and have no way to recapture the funds.
The IRS is giving taxpayers until March 22, 2024, to fully resolve this problem without penalties or interest by repaying 80% of the ERC funds they received.
We encourage anyone who has any concern that they may not have qualified to receive ERC funds to consult with a member of Gallagher & Kennedy's tax department and/or their CPA to determine whether they should take advantage of this limited program.
Below are links to the IRS website giving more information about the repayment program, and an IRS News Release issued this week about how taxpayers can identify improper disbursements.
- Repayment Program Link: https://www.irs.gov/newsroom/irs-new-voluntary-disclosure-program-lets-employers-who-received-questionable-employee-retention-credits-pay-them-back-at-discounted-rate-interested-taxpayers-must-apply-by-march-22
If your company received ERC funds, and you have reason to believe that the company may not have been eligible to receive the funds, or you are concerned that the ERC application may have been inaccurate, please contact a member of the Gallagher & Kennedy tax department for a consultation concerning whether you should consider using this limited-time program offered by the Service.
Click here to read Otto's December 22, 2023, article on this topic published by In Business Magazine.