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.
Sign up for Spidell’s Quarterly Tax Update for more analysis of the ERC VDP. Click here for details.
Sign up for Spidell’s Flash E-mail — Get breaking news delivered to your inbox, plus other free analysis and information for tax professionals. Join our community and stay at the top of your game. Click here to sign up.