KSM (Katz, Sapper & Miller)’s Post

Even with the IRS ERC processing moratorium AND a bill pending in the Senate to halt all furture ERC claims, the IRS is STILL receiving 20,000 ERC claims per week... At this point, it is rare to see an incoming client who 100% qualified and has not submitted a claim. You'd likely be living under a rock or did not have a competent advisors over the past three years. It is possibly there are valid claims outstanding, but at this point, I'd be more skeptical, especially if a promotor who will NOT sign a return, is influencing your claim. The IRS commissioner recently said: "One of the things that impacts our ability to make sure that we're getting to the eligible claims, among the ineligible, is the size of the inventory … Once we issued the moratorium, the influx of claims dropped in half, but I think we got 17 to 20,000 last week. That inventory is growing, and it's growing with a lot of ineligibility." ERC has become a mess, is a drain on IRS resources and unfortunately, many of these pop up ERC shops won't be around to clean up the mess. #ERC #IRS #tax

Now is the time. For all those who procrastinated about claiming the ERC, the final time to file is getting closer. Whether or not the tax bill (see below) does get voted into law, it does highlight the opinion of Congress to curb the program earlier than expected. Will the Jan 31, 2024 deadline actually happen? That we will find out sooner rather than later. But a couple of sure things that seem to be in play: 1. There will be an early deadline and companies will not have until the original April 15th deadline. 2. The IRS is looking for "ERC promoters" who pushed clients into claiming the credit even when they were qualified. So - If you qualify, claim the credit ASAP. If you do not qualify, DO NOT CLAIM the credit. If you do not know whether or not you qualify, check with an expert now. Don't leave money on the table and never take money that isn't yours. https://lnkd.in/gpcEnuxm

Are you eager to file your #incometaxreturn for 2023? The IRS is set to start accepting returns on January 29th. Read here for some more tips and tools.

Curious about the status of your tax refund? 💵 Taxpayers can easily track their refund using the 'Where's My Refund?' tool (linked below). Within 24 hours of filing electronically, you can begin checking your refund status. Typically, refunds are issued within 21 days. https://lnkd.in/eg_k8A8e

IRS Form 709 | Gift and Generation | Skipping Transfers: Recent Updates and Common Mistakes (via JD Supra): https://ow.ly/CoWI50R4FoH #privatewealth #wealthmanagement #trustfunds #trusts #jdsupra

Finally some update from the IRS about the current state of the ERC moratorium TLDR -The Moratorium isn't over, and no date has been announced for it to end. They are very skeptical of their inventory, and you really should make sure your due diligence is on point for outstanding claims. Link to the press release in the comments below but key takeaways for you: They analyzed over 1 Million claims representing more than $86 billion in credits They broke these returns up into 3 main categories: 1- High risk (10-25% of claims on file) claims are going to be denied 2- Beyond that, they estimate 60-70% of claims still present an “unacceptable level” of risk requiring additional analysis before processing and more information.  This one seems obvious because of the way the credit is filed for with just an adjustment on a 941-X with no information about how the business qualified. 3-10-20% are low risk and likely to be processed as is, but processing won’t begin until “later this summer”  (You can still submit requests with the Taxpayer Advocate – link in comments for these claims). Why there is such a broad percentage range in risk categories if the analysis is already complete doesn’t quite add up to me. - Older claims will be worked first, no claims submitted during the moratorium will be processed currently.  (Given the backlog of ~1.4Million returns includes about 800k of pre-moratorium claims, this will still take a while) - They requested to not call them as they will reach out when ready to provide more information or request documentation from claims awaiting processing - They are going to consult with Congress to seek additional help on the ERC program, including closing down new claims entirely and extending the statute of limitations to allow them to pursue improper claims - The withdrawal program is still open for claims needing to be withdrawn (Note this is for a full quarter that needs withdrawal that has not been processed or checks not cashed - link to program in comments) The voluntary disclosure program pulled in 1.09 billion (which out of 230 billion is really not much to brag about if they think 70% of claims are likely bad). They are considering opening it up again at a less beneficial rate (<20% freebie on the payback this time) to help get taxpayers back into compliance. I applaud this as I think the more the tax profession can assist with getting claims back into compliance the better. What should you do? 1- Review what was submitted and make sure you are meeting due diligence requirements (link in comments of a due diligence checklist you can use) 2- If you are in need of support on an existing claim (especially if your tax professional was not involved in the original submittal process), send me a DM as we have helped organizations do withdrawals and corrected 941-X filings for overclaims along with regular substantiating documentation due diligence work

You probably got a call about an ERC claim whether you were eligible or not. This led to many companies getting paid for claims they did not qualify for. If you mistakenly claimed the ERC and received funds, the IRS is now offering a chance to rectify this by returning 80% of the received amount. You can actually retain the remaining 20% of the credit and the interest accrued on the total amount – all tax-free. 🔍 Example to Illustrate: Imagine in 2023, you corrected your 2020 and 2021 payroll taxes and received $200,000 in ERC funds plus $12,000 in interest. If this claim was erroneous, you can now return $160,000 to the IRS and keep $40,000 of the credit plus the $12,000 interest (note: interest is taxable). 🤔 Why Would the IRS Offer This? This initiative aims to correct improper claims while also gathering information on entities that facilitated these claims, such as tax preparers and ERC consulting firms. 🕒 Deadline The window for initiating this process ends on March 22, 2024. You must submit a $0 ERC claim using IRS Form 15434, after which the IRS will review and potentially accept your application, guiding you through the next steps. 📈 Why Consider This? Beyond rectifying your tax records, this opportunity could offer financial relief if your original claim was flawed. 💡 Before You Decide: Examine your ERC claim thoroughly. If it's valid, sticking with your original claim might be more beneficial. For those unsure about their claim's validity or facing complications, this 80 percent payback deal might be a worthwhile consideration.  #IRS #BusinessFinance

When is the right time to become an Enrolled Agent? IMHO right now is the perfect time. As the IRS works to close the tax gap, more taxpayers need tax relief. This storm is providing the perfect opportunity for credentialed preparers to represent taxpayers before the IRS. If you are not credentialed you can assist with paperwork and even 3-way with the client to give clients on calls. However, you can not represent them by stepping in their shoes and resolving the problem. So, why wouldn't you become an Enrolled Agent? Want to create live streams like this? Check out StreamYard: https://lnkd.in/dxEQmK6E

This article is a little late for this year, but important to remember--in the first few months of the year, the info about your TFSA contribution space on the CRA website might be incorrect. This is why it's important to track it yourself and/or wait until after tax time to double check the numbers: "the information posted in My Account...includes only transactions reported to the CRA by financial institutions up to a certain point in time. Since institutions have until the end of February of the following year to submit their reports for the prior year, the information accessed in January may only be partial. A warning to this effect is displayed on the CRA website, and it’s ultimately up to the taxpayer to keep track of their contributions and withdrawals." https://lnkd.in/g28-UNY7

Are you expecting a #refund from the IRS? Check out this tool.