June 21, 2024 - IRS Releases Update on ERC Claims

Matthew Cuplin |

The IRS has released information on a new round of processing for employee retention credit (ERC) claims it received and believes have a low risk of error. However, the agency will be denying tens of thousands of high-risk claims where it concluded the taxpayer is clearly ineligible for the credit. The IRS added that 60-70% of those claims not falling into the high- or low-risk categories still show an unacceptable level of risk and additional analysis and information will be needed. During a recent review, the IRS reached the following conclusions about the ERC claims it has received:

  • 10-20% show a low risk of error and are likely to be paid
  • 60-70% show an unacceptable level of risk and will require additional information
  • 10-20% show high-risk indicators that will be rejected

Taxpayers with ERC claims that are still being processed are being urged not to take any further action or contact the IRS. The agency said it is taking longer to process claims that it did last summer and that taxpayers should await notification from the IRS. The moratorium on new ERC claims continues.