ERC AUDITS
With the unprecedented number of businesses filing for Employee Retention Tax Credit relief, there has been a crackdown by the IRS on auditing of payments sent out. If your business has been contacted by the IRS for an audit, be sure that the original filing was done correctly or reach out to see how an ERC tax attorney can help you navigate through the audit process.
PRE-SCREEN YOUR AUDIT RISK
If you are concerned your ERC filing may have been illegitimate, we have access to certain things within the IRS so we can check to see if you have been flagged for an audit. We would propose strategies custom to your situation based on what we find to keep us one step ahead of the game.
BUILD A LITIGATION FILE
All clients we do an ERC filing for received an opinion letter that essentially pre-audits clients to shield them from any risk. We understand the IRS thought process and can work to build your litigation file so if you are audited, you are properly protected.
DEFENDING YOU IN AN AUDIT
We have developed an extremely deep knowledge base around ERC, which stems from our experience in preparing and advising others in the preparation of difficult claims. Because our ERC tax attorney practice is Federal, we can represent taxpayers in all fifty states.
Overview
The Employee Retention Tax Credit (ERC) was passed on March 27, 2020 as part of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). When the legislation was passed, few people had heard of the credit. However, over the last year, business owners have been bombarded by advertisements from companies they have never heard of before offering to help them claim their credit.
Many of these companies hold themselves out as “experts” in obtaining the credit. They make wild claims, tout their expertise, and make promises to defend their customers in an audit. With promises of hundreds of thousands or even millions of dollars in refunds, many business owners and non-profit organizations have turned a blind eye to the dangers that these companies present.
Types of ERC Audits
What Else Should I Know?
Once misleading/false ERC credit claims made the IRS Dirty Dozen list, tax attorneys started ramping up to defend taxpayers against the IRS. The Dirty Dozen list is the IRS’s annual published list of tax scams that the government considers to be the “worst of the worst.” Indeed, the IRS has responded by using its internal resources to create audit groups that are specially trained to audit ERC claims. We spoke with one auditor recently, who confirmed her job was to audit as many taxpayers as possible.
ERC Fraud has already cost the federal government more than one hundred billion dollars. As such, The IRS has been ramping up swiftly to take strong action against these companies and the taxpayers who have improperly claimed the credit.
The IRS has already issued multiple warnings to the public not to use these services. In March 2023, the IRS wrote, “The IRS and tax professionals continue to see third parties aggressively promoting these ERC schemes on radio and online. These promoters charge large upfront fees or a fee that is contingent on the amount of the refund….The IRS is actively auditing and conducting criminal investigations related to these false claims. People need to think twice before claiming this.”
Furthermore, the IRS has made itself very clear, stating, “Taxpayers are always responsible for the information reported on their tax returns. Improperly claiming the ERC could result in taxpayers being required to repay the credit along with penalties and interest.”
If you were potentially victimized by one of these ERC credit mills or have improperly claimed the credit, you now face the prospect of paying the IRS hundreds of thousands, to maybe even millions of dollars, plus potential penalties and interest fees.
The first step is determining if your ERC was improperly filed. There are some telltale signs that will signal to you if you may have a problem with your claim. The fact that the IRS has approved and refunded your ERC claim does not guarantee that you are in the clear or that the government won’t revisit the matter to collect the funds from you at a later time.
The fact is that the IRS already has an established system for processing amended payroll tax returns and, because of the large number of ERC filings, the government was not able to stop the processing of refunds. However, if the government goes back now and disallows your credit claim, you will not only owe the amount of the credit that you received, but potentially severe penalties and interest as well.
Find Out More About ERC Compliance In Your State
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EXPERIENCED
Dealing with the IRS can seem scary, but Brotman Law brings strategic insight to the process. We have years of experience helping individuals minimize penalties, avoid criminal prosecution, and refocus audits to their advantage.
PERSONALIZED REPRESENTATION
With Brotman Law, you won’t be dealing with a pencil pusher. We handle each ERC tax law case that comes to us with the attention our clients deserve.
UNRIVALED RESULTS
No matter how intricate your audit case becomes, you can rely on Brotman Law’s ERC tax attorneys to resolve it in the best way possible. We have had the privilege of winning countless cases on behalf of our clients. You can also be among our success stories.
Our Clients Will Tell You: We Get Results.
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