In one of those stories that seems to never end, the Employee Retention Credit continues to grab headlines. The latest one began last week when the IRS announced that it is giving a way for employers to rescind inaccurate claims for the ERC if they fell victim to a scam that resulted in filing it.
Of course, one could interpret this as the IRS asking for others to help do their work for them. On the other hand, this is a way for businesses that have realized they were taken in by unsavory characters to avoid having to pay interest and penalties on any monies they could potentially receive.
This comes after the IRS paused processing any new claims after an influx of hundreds of thousands recent ones. So If someone were to rescind their claim filing, it is not as if this was money that could be counted on being received anytime soon anyway.
To that end, this seems a clear good reason for those who know their claim is illegitimate to pull it back. The result will be like it never even happened in the first place. This could also be a good time for those who are unsure of their claim to take some time to see if it was legitimate. After all, this is an actual credit that many received and helped many businesses through the pandemic. And it certainly is true that everyone who is eligible for it has not yet filed and received payment of a claim.
But as with most scams, they begin with these seeds of truth and veer from there.
What then should make you possibly question your claim? If you did not seek the filing yourself and it was marketed to you from an outside source, that should be the first potential warning sign. And this sign should become a blaring alarm if it came to you from someone you have not worked with before.
This potential withdrawing of a claim can now give you the chance to instead consult someone you seek out, and ideally already trust and have a previous relationship with. After that, hopefully you will have an answer in which you can feel more confident.
I understand that this may not be an easy thing to do when the money you could be receiving may be in the many thousands of dollars. But remember that amount and think about having to pay it back … with penalties and interest.
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