What CPAs need to know about employee retention credit fraud
May 25, 2023
By Christopher M. Ferguson, JD and David Taylor
The IRS is targeting these ERC schemes aggressively. Within the past month, it has issued its third warning to taxpayers to be wary of ERC promoters, singled out ERC fraud on its 2023 “Dirty Dozen” list of abusive tax schemes, and issued guidance, doubling as warnings, to tax professionals with respect to the requirements of Circular 230 as applied to ERC claims (IR-2023-49, Mar. 20, 2023). Criminal prosecutions have begun, and promoter investigations and congressional investigations are likely to follow.
It is likely that tax preparers have encountered several clients who are considering claiming ERC credits after responding to such promoter advertisements. This article explains the ERC program, the ways in which it has been vulnerable to fraud, the government’s enforcement efforts around ERC fraud, and what tax practitioners can do to assist their clients, and themselves, when it comes to properly reporting ERC claims.
Read the full article on www.cpajournal.com.