The Internal Revenue Service (IRS) and U.S. Department of Justice (DOJ) are continuing to target PPP and ERC fraud in New Jersey. While the paycheck protection program (PPP) and employee retention credit (ERC) were intended as pandemic-era relief programs, widespread fraud under both of these programs has forced the IRS and DOJ to take aggressive action to recover fraudulent taxpayer losses. To date, the IRS and DOJ have conducted more than 1,600 investigations resulting in nearly 400 sentences—with a 98.5 percent conviction rate in prosecuted cases. But, as New Jersey tax lawyer Kevin E. Thorn, Managing Partner of Thorn Law Group, explains, this is almost certainly just the beginning.

Facing allegations of Employee Retention Credit (ERC) fraud presents substantial risks for businesses and their owners. IRS ERC tax audits and investigations can lead to civil or criminal penalties, and once the IRS opens an inquiry, submitting a voluntary disclosure or withdrawing the business’s ERC claim is no longer an option. In this article, New Jersey IRS tax lawyer Kevin E. Thorn, Managing Partner of Thorn Law Group, explains what owners and executives need to know when the IRS targets their business for suspected ERC fraud.

Facing allegations of Employee Retention Credit (ERC) fraud presents substantial risks for business owners in New Jersey. Combating ERC fraud is a top priority for the Internal Revenue Service (IRS), and business owners accused of ERC fraud can face both civil and criminal penalties. As a result, for those accused of ERC fraud, presenting an effective defense needs to take precedence, and this starts with engaging an experienced New Jersey tax attorney to deal with the IRS.

Kraken, the well-known cryptocurrency exchange, has been ordered by a federal court to disclose customers’ personal information and transaction data to the Internal Revenue Service (IRS). The order comes after Kraken’s prolonged fight to thwart the IRS' “John Doe” summons and after several other cryptocurrency platforms have already been forced (or voluntarily chosen) to comply with similar requests.

Businesses that improperly claimed the Employee Retention Credit (ERC) are facing scrutiny from the Internal Revenue Service (IRS). To help businesses that unknowingly worked with fraudulent promoters and scam artists to submit improper ERC claims, the IRS has announced a process for withdrawing invalid claims before they trigger an audit or investigation. If you think your business may need to file for withdrawal, you should consult with a New Jersey tax lawyer promptly.