By Christopher M. Ferguson
Bloomberg Tax
August 1, 2024
The US Supreme Court’s ruling overturning Chevron deference, as well as the IRS’s own policies, suggest the IRS may be employing a harsh and legally unsustainable standard in assessing the merits of employee retention credit claims.
If true, the IRS may need to pay out many more ERC claims—and the agency may face additional challenges in making good on its pledge to hold promoters accountable for what it maintains were dubious marketing practices leading to the current surge of claims.
The controversy lies in that most of the IRS concerning eligibility for the ERC are found in sub-regulatory guidance, predominantly in the form of a 104-page IRS notice called Notice 2021-20, as opposed to the ERC statute itself.
With the IRS announcing June 20 that it will resume proceessing some ERC claims, it is important to know what rules the IRS is using to address the eligibility of the ERC.
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Reproduced with permission. Published Aug. 1, 2024. Copyright 2024 by Bloomberg Industry Group, Inc. (800-372-1033) http://www.bloombergindustry.com
