Posted on

Be Aware: Employee Retention Credit Scams on the Rise!

If you are a small business you have more than likely heard about the Employee Retention Credit (ERC) by now –

So what is the Employee Retention Credit? – It is a credit that certain employers are eligible for to offset some of their payroll tax for tax years 2020 and 2021. Employers must meet certain criteria such as being mandated to shut down during the #Covid-19 pandemic, or having a significant decline in gross sales. Read more on the specifics and eligibility here:

Now the IRS is warning small businesses about ERC scams. Companies have formed with the sole purpose of “helping” taxpayers claim this #credit. In some cases these are fraudulent claims where the taxpayer does not qualify for the credit. These scammers are also charging businesses large fees to asses their eligibility and claim the credits. Because of the large dollar amounts for these credits, ERC scams have have recently been identified as the #1 worst tax scam for 2023.

The IRS is urging taxpayers to work with a trusted accountant to determine eligibility for the Employee Retention Credit.