The National Taxpayer Advocate is urging the IRS to expedite the processing of over 1.4 million backlogged employee retention credit claims to support small businesses affected by COVID-19, following a halt on new claims due to questionable submissions.
National Taxpayer Advocate Urges IRS to Address 1.4 Million Backlogged Employee Retention Credit Claims for Small Businesses
According to a CNBC report, the Employee Retention Credit (ERC) was designed to provide much-needed support to small businesses during the COVID-19 pandemic. Unfortunately, there’s now a massive backlog of about 1.4 million unprocessed claims, causing major delays. National Taxpayer Advocate Erin Collins is urging the IRS to expedite the processing of these valid claims. The IRS halted new ERC claims in September due to a flood of questionable submissions, which has left many legitimate claims hanging for over a year. This situation has left many businesses frustrated and in limbo, eagerly waiting for the support they were promised.
Collins is concerned about the long wait times, noting that nearly 85% of pending ERC claims have been waiting for more than 120 days. She emphasized that the delay is harming businesses that need these funds. Collins is working with IRS leaders to speed up the processing of eligible claims, especially the thousands of cases pending with the Taxpayer Advocate Service.
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1.4 Million ERC Claims in Limbo: IRS Faces Backlog – Taxpayer Advocate Urges Expedited Processing (PHOTO: ABIP CPA)
IRS Commissioner Highlights Complexity of ERC Claim Processing and Calls for Patience Amid Ongoing Delays
The IRS acknowledges that handling the ERC claim is complex and has asked for patience as it focuses on lower-risk filings and rejects improper claims. IRS Commissioner Danny Werfel stated that this process is necessary to protect taxpayers and ensure that only eligible businesses receive payments. However, the ongoing delays continue to challenge small businesses, highlighting the need for the IRS to balance thorough reviews with timely support.
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