In a recent notice the IRS announced it is accelerating the processing of more than 400,000 claims for the Employee Retention tax Credits (ERC’s) totaling approximately $10 billion.

This is good news for business owners who have waited a year or longer in some cases to receive their refund.

Here is a litte background on the ERC program:

The Employee Retention Credit was established under the CARES Act to encourage businesses to keep employees on the payroll during the COVID-19 pandemic.  Eligible employers could claim a refundable tax credit based on wages paid to employees during 2020 & 2021.

Many businesses that filed for the ERC refund have experienced significant delays in receiving the refunds due to a backlog of claims and suspected false claims.  The IRS has acknowledged these challenges and the impact it has had on businesses that have not receieved their refund.

The IRS announced that it has implemented new measures to streamline the review process for ERC claims.  Additional resources and staff have been allocated to enhance efficiency.  Claims are being prioritized based on submission dates as processing resumes.

This appears to be heading in the right direction and hopefully businesses that qualified for the Employee Retention tax Credits will start receiving their long awaited refunds by years end.