National Taxpayer Advocate Calls Out IRS on ERC Processing

The National Taxpayer Advocate’s Annual Report to Congress noted the IRS’s processing of employee retention credit (ERC) refunds is a serious problem for taxpayers. The IRS delays in processing ERC claims have negative downstream consequences and force taxpayers to make difficult decisions. For example, a taxpayer may have to choose whether to amend their individual income tax return to account for an ERC refund (making an adjustment for the deduction for wages so as not to double dip) even though the refund has not yet been received. What’s more, the IRS disallowance notices issued prior to an examination are confusing and omit critical information. Will the IRS heed the NTA’s recommendations to provide more transparency and expeditated claim processing? #IdeaoftheDay