HILL TAX BRIEF: Inside the IRS’s Pandemic-era Credit Mess

The Employee Retention Credit—created by Congress as the pandemic forced businesses to keep employees home to prevent the spread of Covid-19—was supposed to be a lifeline for companies and workers alike.

It offered as much as $26,000 to businesses for each worker kept on the payroll. But several years after its creation, the ERC has been deemed such a mess that the IRS had to stop processing claims to figure out which are legitimate and which are potentially fraudulent. Lawmakers on both sides of the aisle have decried both fraud around the ERC as well as the processing moratorium.

The ...