The IRS is plagued by false Employee Retention Tax Credit (ERC) claims and is asking Congress for help.
IRS Commissioner Danny Wuerfel also said Thursday that the IRS has completed an internal review of the ERC claims process and will use that information to “reject billions of dollars in clearly unjustified claims.”
“This program has become a gold rush for promoters,” Wurfel told reporters Thursday, urging lawmakers to shut down the ERC program.
“Given what we’re seeing, we believe the right response is to close the ERC program to additional applicants,” Warfel said.
The program was suspended last fall, but Warfel said the IRS still receives about 17,000 applications each week.
Wurfel explicitly placed the blame for the glut of fraudulent applications that has plagued the agency on credit advertisers and marketers, saying their promotional efforts have “swept the airwaves” and created a “gold rush” for their business.
The Employee Retention Tax Credit has already garnered attention from lawmakers, with repeal currently being considered in the Senate as a way to help pay for other tax credits, including other business tax credits and an expansion of the child tax credit.
The credit swap, worth about $79 billion, has stalled in the Senate amid criticism from both Republicans and Democrats.
Wurfel said these bogus requests are preventing businesses with legitimate claims from receiving theirs from the IRS.
Warfel touted the bill on Thursday, saying the IRS wants Congress to enact “ERC-specific” provisions into a tax bill introduced by top tax experts Sen. Ron Wyden, D-Ore., and Rep. Jason Smith, R-Mo.
