Reopened ERC Voluntary Disclosure Program Will Run Through November 22, 2024

The Internal Revenue Service (IRS) has reopened the Employee Retention Credit (ERC) Voluntary Disclosure Program that closed in March of this year. The reopened ERC Voluntary Disclosure Program runs through November 22, 2024, and eligible businesses can submit applications under the program to avoid the risk of facing an ERC-related audit or investigation. However, as New Jersey tax attorney Kevin E. Thorn, Managing Partner of Thorn Law Group, explains, not all businesses are eligible to file, and filing doesn’t necessarily guarantee that the IRS will look the other way.

What New Jersey Business Owners Need to Know About the Reopened ERC Voluntary Disclosure Program

Just like last time, participation in the reopened ERC Voluntary Disclosure Program is subject to strict eligibility criteria. Additionally, while submitting a voluntary disclosure provides the opportunity to resolve ERC-related concerns without facing an IRS audit or investigation, a favorable and quiet resolution is not guaranteed. Seeking relief involves submitting an application under the ERC Voluntary Disclosure Program, and the IRS is reviewing all applications submitted. If a business that applies is ineligible, relief won’t be granted—and the application could trigger a civil or criminal inquiry.

The IRS makes this clear, stating both, “[o]nce the employer has applied to the VDP . . . an IRS employee will contact them to go over the application and answer any questions,” and “if you willfully claimed an ERC that is fraudulent, or if you assisted or conspired in such conduct, applying to the second ERC-VDP will not exempt you from potential criminal investigation and prosecution.” If the IRS rejects a business’s application for any reason, it can use the information contained in the business’s application to pursue civil or criminal penalties.

With this in mind, while business owners who have ERC-related concerns should be proactive about resolving these concerns, they should also ensure that they are making informed decisions. There are alternatives to submitting an application under the reopened ERC Voluntary Disclosure Program—and these alternatives will prove more advantageous in many cases. For example, depending on the circumstances at hand, options that may be preferable to submitting an application under the reopened ERC Voluntary Disclosure Program include:

• Filing an amended tax return;
• Withdrawing the business’s ERC claim; or,
• Submitting an application under IRS CI’s Voluntary Disclosure Practice.

Choosing the best path forward when you have concerns about ERC fraud requires experienced legal representation. At Thorn Law Group, we have experience representing numerous taxpayers in ERC-related matters. We can help you decide whether to submit an application under the reopened ERC Voluntary Disclosure Program and if submitting an application is not a viable solution to your ERC-related problems, we can help you decide how best to proceed.

Contact a New Jersey Tax Attorney at Thorn Law Group

If you need to know more about the IRS’ reopened ERC Voluntary Disclosure Program, we invite you to get in touch. Please call 201-842-7696 or contact us confidentially online to schedule an appointment with a New Jersey tax attorney at Thorn Law Group.