IRS Highlights Key Warning Signs for Businesses to Apply for ERC Voluntary Disclosure
As we approach the March 22nd deadline to apply for the ERC Voluntary Disclosure program, the IRS has spotlighted seven warning signs to help small businesses identify potentially erroneous claims, stemming from misleading information circulated by certain promoters. The warning signs include overstated quarters claimed, incorrect interpretations of government orders, erroneous calculations of employee wages, uncommon claims based on supply chain disruptions, and claims for non-existent businesses or periods without wage payments. Promoters have misled businesses with overly simplified eligibility criteria, leading to inappropriate claims. Commissioner Danny Werfel emphasized the increasing compliance activity surrounding ERC claims and urged businesses to swiftly review their eligibility with trusted tax professionals before the March 22 deadline, wherein participants can repay only 80% of the incorrect claim.
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