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.
ERC TAX ATTORNEY HELPING INDIVIDUALS FIX ILLEGITIMATE CLAIMS
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.
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.
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.
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.
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.”
The first step is determining if your Employee Retention Credit was improperly filed. There are some telltale signs that will signal to you if you may have a problem with your Employee Retention Tax Credit claim. Just because the IRS processed your Employee Retention Tax Credit and gave you a refund does not mean that you do not have a problem or does not mean that the government cannot go back and try to collect the money from you later.
The fact is that the IRS already has an established system for processing amended payroll tax returns and, because of the large number of Employee Retention Tax Credit 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.
Yes, this is very serious. This could cost your business a lot of money or get you locked in a face-off with the IRS. Audits are serious business, particularly if the government thinks you have done something wrong. First though, don’t panic. The tendency of people who find themselves in a hole is that they want to climb out of it as quickly as possible without strategizing the best way out of the situation. Instead, take a deep breath and deal with the realization that you have made a mistake, but equally recognize that you are going to do what it takes to fix it. You have to have a gameplan or you are just going to make matters worse.
At least for the time being. Your first reaction is going to be to contact the IRS to try and unwind the problem by reamending returns and reversing the credit. This is the last thing you should do. Much like stealing something and thinking that returning it is going to solve all your problems, reamending your returns without proper guidance will just make matters worse. You also do not want to contact the ERC company that filed your claim. You doing what is in your best interest is adverse to their interest of making as much money as possible off of your ERC claim. If push comes to shove, they will do whatever needed to keep themselves out of trouble.
Your CPA is not the person to help you with this situation. As good as they may be at tax reporting, CPAs are not trained to deal with these types of issues. First, CPAs generally do not deal with payroll tax issues. Second, if the situation goes south, your CPA is not trained in advocacy or defending businesses against the IRS and is going to recommend that you hire an attorney anyway. As we will explain, the fixes to this situation are usually above the depth of your CPA’s experience. Make no mistake, you need someone that is equally versed in tax law and tax procedure (i.e. how the IRS works).
Our ERC lawyers will aggressively work to defend and protect your interests
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.
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.
No matter how intricate your audit case becomes, you can rely on ERC tax attorneys at Brotman Law 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.
Set up a quick call with our firm's concierge to see if we'll be able to help you. The whole process will take 10 minutes or less. If your matter is urgent we will also help to expedite a meeting with Sam.
Tax law can be complex, confusing, frustrating, and even scary. We're here to help!
IRS Circular 230 Disclosure: To ensure compliance with requirements imposed by the IRS, I must inform you that any U.S. federal tax advice contained in this website is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter contained in this website.