Today, the IRS announced a second Employee Retention Credit (ERC) Voluntary Disclosure Program (VDP). (IRS Announcement 2024-30) Notable aspects of this second ERC VDP are:
- The second ERC VDP is only available for ERC claims filed for tax periods in 2021 and for which the taxpayer received an ERC refund prior to August 15, 2024;
- Where the first ERC VDP allowed taxpayers to repay only 80% of their erroneously received ERC refunds, this second ERC VDP requires taxpayers to repay 85% of their erroneously received ERC refunds;
- Applications must be filed using IRS Form 15434, Application for Employee Retention Credit Voluntary Disclosure Program, on or before 11:59 p.m. local time on November 22, 2024; and
- Applications and any required attachments must be submitted using the IRS’s Document Upload Tool at irs.gov/dut.
Other details of the second ERC VDP are similar to the first ERC VDP, such as:
- Taxpayers must apply prior to being audited or otherwise investigated by the IRS for the ERC claimed;
- If a taxpayer used a third-party payer (e.g., a PEO) to apply for the credit, the third-party payer must submit the application for the VDP;
- Relief from civil, but not criminal, penalties for program participants;
- The requirement to execute a closing agreement; and
- The requirement to provide preparer/advisor information for those who helped prepare the taxpayer’s original ERC claim, among others.
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