Keep an Eye Out for ERC Refund Scams
For the start of the annual Dirty Dozen list of tax scams, the IRS spotlighted Employee Retention Credits (ERCs) following blatant attempts by promoters to con ineligible people into claiming the credit. The IRS highlights schemes from promoters who have been blasting ads on radio and the internet touting refunds involving ERCs. These promotions can be based on inaccurate information related to eligibility for and computation of the credit. The IRS Office of Professional Responsibility sent a special bulletin (OPR Issue 2023-02) to tax professionals on 3/7/23 outlining core responsibilities for ERC claims under Circular 230. The IRS is stepping up enforcement action involving these ERC claims and people considering filing for these claims (only valid during the pandemic for a limited group of businesses) should be aware they are ultimately responsible for the accuracy of the information on their tax return.