IRS Is ‘Daring People to Sue’ Over Pandemic Credit Crackdown

IRS efforts over the past year to clean up an embroiled tax credit program have put companies seeking long-delayed payments in a position they’re trying to avoid—going to court.

Many businesses expected to reap thousands or millions in cash in the form of the employee retention tax credit after staying open and keeping employees on the payroll during the Covid-19 pandemic. ERC claims at first came in slower than expected but that quickly changed as pop-up firms skyrocketed, conning companies into claiming the credit when they didn’t qualify.

The IRS was caught flat-footed. It subsequently went on offense to ...