IRS Crackdown on Employee-Retention Credit Claims Saves over $1 Billion

In efforts to thwart fraudulent claims, the IRS has implemented a moratorium on processing new Employee Retention Credit (ERC) claims, along with two new compliance programs. As a result, over $1 billion has been saved by the US government. The ERC Voluntary Disclosure Program saw more than $225 million returned, with over 500 employers participating, while the ERC withdrawal process resulted in roughly $251 million withdrawn from about 1,800 employers. The IRS has also assessed $572 million relating to more than 22,000 ERC claims. Although the ERC VDP has closed, the IRS hinted at a potential reopening based on congressional actions. However, there are still more than 1 million unprocessed ERC claims, and the IRS plans to intensify compliance efforts in the near future. While the moratorium on new ERC claims remains in place, the IRS anticipates its end in the late spring. For more details, you can read the full IRS media release here.