In an about-face from July’s hearing and press releases, the Internal Revenue Service (IRS) announced September 5, 2023, that it will intentionally slow down the processing of Employee Retention Credit (ERC) claims. The IRS has received an abundance of suspicious, fraudulent, or inappropriate claims, and the intention is to more carefully analyze submissions prior to issuing refund monies.

The IRS has already paid out an excess of $150 billion in claims, and allegedly, there is a burgeoning influx of claims fueled by the third-party consultants that LeadingAge has repeatedly warned members to carefully screen. No new timeline has been offered for when ERC claimants can now expect a response or refund, and there are no answers to how the IRS will handle claims filed by organizations who were misled by unscrupulous third-party consultants. At present, organizations that have received funds in error will have to return funds and potentially with interest and monetary penalties.

More information is expected to be forthcoming. LeadingAge members can continue to access our webinar recordings on the Hub. For more on the ERC frequently asked questions recently updated by the IRS, see this LeadingAge article. If you have an ERC experience you’d like to share, or if you have filed and are still waiting on a refund, please email Dee Pekruhn (dpekruhn@leadingage.org) or Nicole Fallon (nfallon@leadingage.org).