Today's New York Times reports that the IRS has announced around 90% of claims for this credit, which was created in 2020, appear to be fraudulent.
According to Stan Brown <the_stan snipped-for-privacy@fastmail.fm:
This press release says, among other things:
Audits: The IRS has thousands of ERC claims currently under audit.
Thanks for the link, John. My question was whether the IRS can audit _approved_ claims, and if so whether it's going to attempt to claw back the money paid out. Initially I forgot that "audits" can come after a return has been accepted and any refund paid.
And the press release answers it explicitly, a little earlier:
"Compliance work on previously processed ERC claims continue [sic], and work continues on a number of efforts to counter questionable claims:
"... The IRS has determined that more than 12,000 entities filed over
22,000 claims that were improper and resulted in $572 million in assessments. This initial round of letters covers Tax Year 2020. Thousands more of these letters are planned in coming months to address Tax Year 2021, which involved larger claims. ..."It's the "previously processed" ones -- "approved", as I would have said -- that I was curious about.
In hindsight, I have to admit it was a silly question. I had forgotten: If you file a 1040 that claims more of a refund than you're entitled to, they may very well pay it initially but then come back later with an assessment. There's no reason the ERC should be any different.
With the exception of the extended statute of limitations Congress provided for ERC claims.
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