IRS Allows Ineligible Employers to Return ERC Money
According to the IRS, if an employer is not eligible for the ERC:
Did not have a limit in trade, group meetings or travel restrictions due to appropriate COVID-19 mandate orders nor suffered a decline in gross receipts.
Was scammed into improperly claiming the Employee Retention Tax Credit (ERC) by a promoter who did not follow the rules
Received a cash refund of payroll taxes
Will cooperate with authorities to prosecute the promoter
… there are now steps whereby the employer can repay the money.
The Voluntary Disclosure Program (ERC-VDP) is open through March 22, 2024. The program requires employers to:
File a series of tax forms that reconcile the amounts improperly received, by each quarter,
Voluntarily pay back the ERC, minus 20%,
Cooperate with any requests from the IRS for more information to prosecute the promoter,
Sign a closing agreement, and
Comply with all other requirements within the VDC Program.
The IRS urges employers to consult with a trusted tax professional. Please contact us if you believe you were victim of a scam and require assistance with the calculations and forms.
