IRS Criminal Investigations Intensify for Pandemic Tax Credit

IRS Criminal Investigation has started probes involving over $3.4 billion in potentially fraudulent employee retention credit claims, the agency announced Tuesday.

The ERC is a refundable tax credit that was designed to encourage companies to keep employees on their payroll and help businesses stay afloat during the pandemic. But some third-party companies misled taxpayers into claiming relief they didn’t qualify for.

As a result, the IRS temporarily stopped the processing of new claims to help mitigate fraud and created a withdrawal program to help employers who unknowingly filed a fraudulent claim avoid penalties.

IRS ...