Is the ERC a Scam? What to Know About the Employee Retention Credit

April 28, 2023
Dayes Law Firm

You may have heard about the Employee Retention Credit (ERC or ERTC), but may not know whether or not you and your business qualify to apply for the tax credit, or even if you should trust what you’ve heard about the program. The Internal Revenue Service and Better Business Bureau both recently put out warnings about ERC scams, and the team at Dayes Law Firm is here to reassure you that the program is legitimate and that we can help you qualify. 

Is the ERC a Scam?

No, the ERC is not a scam. It is a real, fully refundable payroll tax credit. 

The ERTC/ERC was created as part of the CARES Act and was meant to be an incentive for businesses that experienced major setbacks during the height of the COVID-19 pandemic but continued to employ W2 staff. 

The ERC tax credit offsets the quarterly employment taxes businesses are required to pay. Your business could be eligible to receive an ERC check if you suffered losses and faced restrictions during the pandemic, especially if those losses and restrictions happened between Q4 2020 and Q3 2021.

Avoiding Employee Retention Credit Scams

The reason the IRS and BBB have recently put out warnings about ERC scams is that there are some people or companies out there acting in bad faith to trick you into claiming tax credits that you and your business aren’t eligible to receive.

“While the credit has provided a financial lifeline to millions of businesses,” said IRS Commissioner Danny Werfel recently, “there are promoters misleading people and businesses into thinking they can claim these credits.”

“There are very specific guidelines around these pandemic-era credits; they are not available to just anyone. People should remember the IRS is actively auditing and conducting criminal investigations related to these false claims. We urge honest taxpayers not to be caught up in these schemes.”

You can avoid ERC scams by finding reputable ERC specialists, like the experts at Dayes Law Firm, to help you first determine if you are eligible to apply for the ERC and then help you do so. 

ERC Audit Defense

Our team of experienced tax attorneys has already assisted businesses in filing for over $250 million in ERC tax credit claims, and we offer an audit guarantee – we will stand behind any refunds we believe are owed to your business. Our ERC experts are prepared to assist your business with any possible ERC audit, or if there is a request from the IRS for an audit in the future.

The IRS noted in its warning about ERC scams that business owners “should listen to the advice of their trusted tax professional.” Frankly, we couldn’t agree more! 

Dayes Law Firm and our partners have been in business for years. We have an established record for success when it comes to managing ERC applications. If you think you might be eligible for this program and want to work with a trustworthy team of tax professionals, give us a call today to learn more.