As part of its response to the COVID-19 pandemic, the federal government created several programs to help business owners remain open and make payroll. One of those tools is the Employee Retention Credit (ERC). This refundable tax credit provides cash payments for certain companies to cover some of the wages that were owed at the time. Skilled tax attorneys have been assisting businesses with this process for years.
While this program is no longer open, it is still possible to amend past tax returns and qualify for a credit. However, the federal government is constantly auditing these requests in search of fraud. Whether you are dealing with an audit or hope to still qualify, the support of an ERC tax lawyer could be invaluable to your company.
The ERC program has closed, and it is no longer possible to seek payments for current wages regardless of the number of employees a company has. However, it may still be possible to secure these tax credits for wages paid out during the COVID-19 pandemic.
First, an applicant must be certain they qualify for the program in general. This tax credit is only available if the applicant trade, business, or tax-exempt organization was operating and paid wages to employees at some point between March 13, 2020 and Dec. 31, 2021.
There must be evidence of these payments, starting with employment records that prove the employees were paid. This evidence could include gross receipts, government orders, or other documents confirming each payment.
The opportunity to obtain these credits is still available, but only for a limited time. A business may apply for ERC for wages they paid out from 2020 to 2021 by claiming the credit on amended tax returns for that period. However, these claims will need to be amended by the 2025 tax season. An ERC tax attorney could assist with this process.
There is also a process for resolving claims that were incorrectly filed. If a taxpayer determines they were not eligible for this tax credit, an ERC tax attorney may suggest that they withdraw their claim, as long as they have not received the credit already or deposited the ERC check.
This process can be completed online. It involves requesting that the IRS treat the taxpayer’s claim as if it were never filed. This is an important option for anyone who mistakenly requests a tax credit before determining they do not qualify.
The IRS is actively auditing ERC claims. Federal agents will calculate whether a company is seeking the right number of credits and investigate whether the company was actually in operation when ERC was available.
Facing an audit can be distressing, but there is no need to deal with it alone. An ERC tax attorney could not only ensure the amended returns are filed appropriately, but they could also deal with any issues that arise with the IRS during the process.
The ERC program is an excellent opportunity for businesses that managed to not only survive the pandemic but also keep their workforce intact. If you believe you qualify for a credit, schedule a free case evaluation with an ERC tax lawyer at Price Benowitz today.
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