The IRS has taken decisive action against questionable Employee Retention Credit (ERC) claims, sending out over 20,000 disallowance letters to individuals and entities that either lacked existence or had no employees during the eligibility period.
As part of an expanded initiative to combat fraudulent claims, the IRS intensified its scrutiny of ERC submissions, identifying a substantial number that failed to meet the credit’s basic criteria.
Those found ineligible will receive Letter 105 C this week, signifying the disallowance of their claims.
Despite ongoing criminal investigations and numerous ERC claims under audit, this targeted group includes entities that either didn’t exist or lacked paid employees during the specified eligibility period.
