A Covid Lifeline for Businesses Has Become Curse for the IRS (1)

It was created from desperation.

Businesses wanted a lifeline to stay open and keep people employed when Covid-19 paralyzed the economy in early 2020. Congress responded with several ways to send cash with few questions asked.

One, the Employee Retention Credit, promised as much as $26,000 for each employee kept on a payroll. Businesses only had to fill out a few lines added to a quarterly payroll tax form that most have to file anyway.

Some fraud was inevitable, former IRS Commissioner Chuck Rettig said in an interview. What the IRS didn’t expect was that by mid-2023, there was so ...