What Should I Do if I Receive an IRS Notice Related to the ERC?

May 17, 2023
Dayes Law Firm

If you applied for the Employee Retention Tax Credit, and later received a notice from the IRS, don’t panic. The agency could be asking you for a range of different types of information, and it’s not always necessarily a bad thing to hear from them. But if you do receive an IRS notice related to the ERC, and it involves your application, there are actions you can take to remedy a potentially negative situation. 

Receiving an ERC IRS Notice

If you have received an IRS notice related to the Employee Retention Credit (ERC/ERTC), you should first carefully review the notice to understand why it was sent to you and what action the IRS is requesting from you. If you believe that you filled out your ERC application process correctly in the first place, you should have information like payroll data and other analysis and calculations ready to go if the IRS is requesting any of those details. 

You should have copies of any completed forms that you as an employer submitted to the IRS for your ERTC application – or, if you worked with a reputable tax professional or ERC company, they should have that data ready whenever you might need it. 

Once you’ve reviewed the notice, if you have any questions or concerns about it, you can turn to a trusted tax professional who can provide guidance and assistance in responding to the notice in the appropriate manner. 

Consulting with a tax professional is never a bad idea in these situations, and if, for whatever reason, you don’t want to work with a tax lawyer who helped you previously, you can also work with a team like ERC attorneys at  Dayes Law Firm. We know the Employee Retention Tax Credit inside and out, and we’d be happy to help.

Whether you’re working with us or another tax professional, it’s extremely important to respond to the IRS notice about the ERC promptly and with accurate information. Failing to do so may result in additional penalties or interest charges – or, unfortunately, even an official ERC audit

If you think the notice was sent in error or if you need more time to respond, you can likely request an extension or file an appeal with the IRS. Again, this is something that an ERC-knowledgeable tax professional can always help you with.

If you received a notice related to the ERC, there’s a chance there’s a discrepancy between your claim for the tax credit and the information the IRS has on file for you and your business. It’s possible this could be due to an error or mistake in your filing, in which case, you should definitely have a tax specialist look over the notice and your previous ERC paperwork to determine what the issue is.

Whatever the reason for the notice may be, if you have received an IRS notification related to the ERC, it’s important to take it seriously and to respond quickly. The last thing you want to contend with is an IRS audit, but if you do end up dealing with one, or with other ERC-related issues, the team at Dayes Law Firm can help.

Our team of skilled tax attorneys can assist you if you’re dealing with an ERC tax credit audit and you need a strong defense. Contact us for a no-obligation, free consultation, and see how the ERC team at Dayes Law Firm and our partners can help you now!