When Covid struck, it had a detrimental impact on many people, leading to job losses
and business closures. The pandemic-era employee retention credit (ERC) was
established to encourage businesses to retain staff during the pandemic by providing a
refundable tax credit. If the credit exceeds the employer's payroll tax bill, the excess is
repaid to the employer. Although it was not open to all enterprises, it was eligible to
those that were fully or partially halted due to government orders or a drop in gross
sales in 2020-2021. Unfortunately, as with many good things in life, a few people ruin it
for others. "As of Feb. 28, 1,028 people have been indicted on COVID-related crimes,
and 569 individuals have been sentenced to an average of 31 months in federal prison"
(Journal of Accountancy). It will officially end on April 15, and for some organizations,
because of the massive number of claims, the process has been extremely slow and
inconsistent because the IRS does not review each set of claims from a single business
at the same time.
