The Employee Retention Credit (ERC) program, though perhaps not as recognized as the Paycheck Protection Program, was a significant initiative in the COVID relief efforts administered by the federal government. Aimed at supporting businesses throughout 2020 and 2021, the ERC allowed employers to claim refundable payroll tax credits. These amounted up to $10,000 per employee during 2020 and $10,000 per employee per quarter throughout 2021 as compensation for wages accorded to their employees during these years.
However, with any substantial program of this type, there comes a degree of cautionary tales. Professionals navigate a landscape featuring promoters claiming to offer services, often seemingly too good to be true, in relation to such initiatives.
With this in mind, practitioners should approach with due diligence and skepticism to ensure they avoid potentially damaging legal and financial implications. Mitigating this risk primarily involve thoroughly researching all promoters and their related offerings, validating their claims independently, and seeking reliable, expert advice when in doubt.
A comprehensive summary of the risks associated with the ERC and guidance on promoter dealings can be found in an article titled “Too Good To Be True? Be Wary of ERC Promoters” published by Lowndes. Following these general principles can serve to prevent falling victim to a scenario that may initially appear to be a highly beneficial deal, but is, in fact, potentially liable to incite legal complications.