This article is reproduced with permission from Spidell Publishing, Inc.
The IRS announced on September 14, 2023 that it has stopped processing all new Employee Retention Credit (ERC) refund claims and will continue its moratorium at least through December 31, 2023. (IR-2023-169)
In IRS Commissioner Werfel’s words:
“The IRS is increasingly alarmed about honest small business owners being scammed by unscrupulous actors, and we could no longer tolerate growing evidence of questionable claims pouring in. … The continued aggressive marketing of these schemes is harming well-meaning businesses and delaying the payment of legitimate claims, which makes it harder to run the rest of the tax system.”
The IRS is continuing to process ERC claims filed prior to today’s announcement, but even those claims will face long processing delays (up to 180 days, from 90 days) because the IRS is placing stricter compliance reviews on all claims.
Today’s release does not specifically advise taxpayers to not file new claims. It only states that the IRS will not process any new claims until January 2024 at the earliest.
Taxpayers whose ERC claims are currently in process may:
- see requests for additional substantiation from the IRS before the claim’s processing is complete;
- be referred to the IRS’s examination division for audit;
- be referred to the IRS’s criminal investigation division if the egregious nature of the claims warrants it; or
- soon be able to withdraw filed, but unprocessed, ERC claims under a special program, the details of which are still being worked out by the IRS.
Additionally, the IRS is developing a new settlement program for taxpayers who received an improper ERC payment. Per the IRS, more information on this program will be available this fall.
The IRS’s release is available at the following link and contains advice for taxpayers whose ERC claims may be in various stages. Go to: