IRS immediately halts the processing of new ERC claims

September 15, 2023
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The IRS announced on September 14, 2023 that it would immediately halt the processing of new Employee Retention Credit claims to add more safeguards to protect businesses from scams and prevent future abuse. The moratorium will run through at least December 31, 2023. 

For claims filed prior to the moratorium, payouts will continue, but at a slower pace due to the detailed compliance reviews. With the stricter compliance reviews in place during this period, existing ERC claims will go from a standard processing goal of 90 days to 180 days — and much longer if the claim faces further review or audit. The IRS may also seek additional documentation from the taxpayer to ensure it is a legitimate claim.

As of July 2023, there were 252 criminal investigations involving over $2.8 billion of potentially fraudulent Employee Retention Credit claims.

Commissioner of the IRS, Danny Werfel said, “For those people being pressured by promoters to apply for the [ERC], I urge them to immediately pause and review their situation while we look to add new protections and safeguards to stop bad claims from ever coming in. In the meantime, businesses should seek out a trusted tax professional who actually understands the complex ERC rules, not a promoter or marketer hustling to get a hefty contingency fee.”

Read the full article from the IRS

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