IRS Continues ERC Moratorium and Denies Highest-Risk Claims

IRS Continues ERC Moratorium and Denies Highest-Risk Claims: The IRS announced plans to deny tens of thousands of improper high-risk Employee Retention Credit (ERC) claims while starting a new round of processing lower-risk claims to help eligible taxpayers. Since last September, the IRS has been conducting a detailed review to protect taxpayers and small businesses, which included months of digitizing information and analyzing data to assess a group of more than 1 million ERC claims representing more than $86 billion. The IRS identified between 10% and 20% of these claims fall into the highest-risk group, which shows clear signs of being erroneous claims. Tens of thousands of these high-risk claims will be denied in the coming weeks. The IRS analysis also estimates between 60% and 70% of the claims show an unacceptable level of risk, and between 10% and 20% show a low risk. For those claims with no eligibility warning signs that were received prior to last fall’s moratorium, the IRS will begin processing more of those claims. News Release IR 2024-169.

Similar Posts

  • MID YEAR TAX LETTER

    To Our Clients and Friends: The past year has been challenging to say the least. Hopefully the COVID-19 crisis, which affected all of us in some ways, is nearing the end. While it has been difficult to focus attention on much other than the health and safety of our loved ones, tax planning can’t take…

  • No Tax on Social Security?

    By Stephanie Phillips On July 4, 2025, a new bill was signed into law.  Among the tax law changes, a new deduction for seniors who are 65 and older was put in place to help reduce taxable income, including taxed social security benefits.  This deduction is called the enhanced deduction for seniors.  The deduction is…

  • Notice IR-2025-110: Treasury, IRS provide penalty relief for tax year 2025 for information reporting on tips and overtime under the One, Big, Beautiful Bill

    IR-2025-110, Nov. 5, 2025 WASHINGTON — The Department of the Treasury and the Internal Revenue Service today issued guidance providing penalty relief to employers and other payors for tax year 2025 regarding new information reporting requirements for cash tips and qualified overtime compensation under the One, Big, Beautiful Bill. Transition penalty relief for tax year…

  • DELAY IN 2020 TAX REFUND

    If you haven’t gotten your 2020 tax refund, you aren’t alone. At the end of the 2021 filing season in May, the IRS had a backlog of 35 million tax returns that still needed to be manually processed, according to a report released Wednesday by the National Taxpayer Advocate, a government watchdog. The backlog includes…

  • EMPLOYEE RETENTION CREDIT

    The Basics on the CARES Act version • Payroll tax credit available for 50% of qualified wages paid by an eligible employer to its employees after 3/12/20 and before 1/1/2021 • Eligible employer – an employer whose 1) operations have been fully or partially suspended as a result of an appropriate government order limiting commerce…

  • RECAP 2022 TAX PROPOSALS

    *Biden Administration tax proposal for 2022* • Raise corporate tax rate from 21 percent to 28 percent • Eliminate credits, deductions and other tax provisions that are targeted towards encouraging oil, gas and coal production • Provide additional tax credits to extend and enhance renewable and alternate energy incentives • Establish new business tax credit…