IRS will pause taking claims for pandemic-era tax credit due to an influx of fraudulent claims

[dalton99a]

https://apnews.com/article/small-business-fraud-erc-irs-161fb191d159548949d42a015910e9c2

IRS will pause taking claims for pandemic-era tax credit due to an influx of fraudulent claims
By MAE ANDERSON
Updated 4:02 PM CDT, September 14, 2023

The Internal Revenue Service is pausing accepting claims for a pandemic-era tax credit until 2024 due to rising concerns that an influx of applications are fraudulent.

The tax credit, called the Employee Retention Credit, was designed help small businesses keep paying their employees during the height of the pandemic if they were fully or partly suspended from operating. The credit ended on Oct. 1, 2021, but businesses could still apply retroactively by filing an amended payroll tax return.

A growing number of questionable claims are coming from small businesses who may or may not be aware that they aren’t eligible. Because of its complex eligibility rules, the credit quickly became a magnet for scammers that targeted small businesses, offering them help to apply for the ERC for a fee — even if it wasn’t clear that they qualified. The credit isn’t offered to individuals, for example.

“The IRS is increasingly alarmed about honest small business owners being scammed by unscrupulous actors, and we could no longer tolerate growing evidence of questionable claims pouring in,” IRS Commissioner Danny Werfel said. “The further we get from the pandemic, the further we see the good intentions of this important program abused.”

The IRS has received 3.6 million claims for the credit over the course of the program. It began increasing scrutiny of the claims in July. It said Thursday hundreds of criminal cases have been started and thousands of ERC claims have been referred for audit.

...

[LiberalFighter]

1. Is this the same tax credit advertized on tv?

If so, they should go after the group that is pushing people to apply with them.

[dalton99a]

2. Yep, on TV and radio

[underpants]

3. Regular ads for this on talk radio.

Like a lot of them.

No fee of course….just “a percentage” of what these operations recoup for you.

These ads are more prevalent of late than the incredible opportunities when you buy gold (30% commission not mentioned in the ads).

[usonian]

4. Good. The ads on sports talk radio are nonstop.

About 10 an hour (feels like 60) with new advertisers jumping in the feeding though.

F-them all.

Covid was a UUGE windfall for the wealthy, no surprise, given the scumbag in power.

[dalton99a]

6. $230 billion already paid out for this credit

In 2021, after Congress expanded eligibility, the Congressional Budget Office projected that the credit would cost the federal government about $85 billion over a decade — up from an earlier estimate of $55 billion. The I.R.S. said on Thursday that it had already paid out about $230 billion in refunds associated with the tax credit and that it had a backlog of 600,000 claims.

https://www.nytimes.com/2023/09/14/us/politics/irs-pandemic-employee-credit-fraud.html
https://archive.ph/eSx7r

[jimfields33]

5. Because of its complex eligibility rules,

Sounds like they made it difficult to understand. Figures.

[CountAllVotes]

7. Attention frauds out there

Businesses, including nonprofit organizations and churches, have been able to seek up to $26,000 for each employee on their payrolls if they can show that their operations were fully or partly suspended in 2020 or part of 2021, and report a significant decline in their revenues during that time. Before the moratorium was announced, they had until 2025 to file claims.

****

Only frauds do things like this.

Sad state of affairs when people are so hard up for money that they will say and do things like this. I do my best to avoid them as should others IMO.

What goes around comes around.

& recommend.

[GreenWave]

8. influx of fraudulent GQP claims.

fixed it for them.