Treasury and the Internal Revenue Service (IRS) continue to ratchet up pressure on employee retention tax credit (ERTC) claims that they say show evidence of fraud. That, in turn, puts pressure on ERTC claims that, while not necessarily fraudulent, may contain errors and thus attract the attention of government officials cracking down on ERTC claims.

On November 22, Treasury’s Financial Crimes Enforcement Network (FinCEN), in coordination with the IRS’s Criminal Investigation (CI), issued an alert to financial institutions on fraud schemes related to the ERTC. In the alert, FinCEN and CI “urge vigilance in identifying and reporting suspicious activity.”

Prospects: The FinCEN/CI alert adds pressure to the government’s already-announced initiative to ferret out and deal with ERTC fraud. As one ERTC expert phrased it, “FinCEN’s involvement means this is very serious.” So, any NAIFA member who has submitted an ERTC claim would be well-advised to be sure the claim complies with all of the tax credit’s qualification rules, to avoid a run-in with government enforcers who will be looking for fraud in even the most innocent of mistakes.

NAIFA Staff Contact: Jayne Fitzgerald – Director – Government Relations, at jfitzgerald@naifa.org.