Urge clients to resolve incorrect ERC claims now

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e-News for Payroll ProfessionalsMarch 20, 2024

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Issue Number:  2024-03

Inside This Issue

  1. Deadline is March 22 for program to resolve incorrect Employee Retention Credit claims at 20% discount

 1.  Deadline is March 22 for program to resolve incorrect Employee Retention Credit claims at 20% discount

Payroll professionals: Please urge every client that filed for the Employee Retention Credit (ERC) to act now to make sure they didn’t incorrectly claim the credit.

Some businesses may need help from their payroll service provider to resolve an incorrect claim. ERC information for payroll service providers:

The IRS has two options to help businesses voluntarily resolve incorrect claims:

  • Employers who received an incorrect ERC by December 21, 2023, either as a refund or as a credit on a tax return, can apply to the ERC Voluntary Disclosure Program. This option, available through March 22, 2024, lets a taxpayer repay the incorrect ERC, minus 20 percent, for any tax period they weren’t eligible for ERC. Generally, businesses who enter this program don’t have to amend other returns affected by the incorrect ERC and don’t have to repay interest they received from the IRS on an ERC refund.
  • Businesses should quickly pursue the claim withdrawal process if they need to ask the IRS not to process an ERC claim for any tax period that hasn’t been paid yet. Taxpayers who received an ERC check, but haven’t cashed or deposited it, can also use this process to withdraw the claim and return the check. The IRS will treat the claim as though the taxpayer never filed it. No interest or penalties will apply.

ERC resources

Share these resources with clients to help them review ERC eligibility and resolve incorrect claims:

Latest news and ERC articles to share

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