IRS webinar: Employee Retention Credit – Voluntary Disclosure Program

IRS webinar: Employee Retention Credit – Voluntary Disclosure Program

I see it's the top of the hour. For those of 
you just joining, welcome to today's webinar,   Employee Retention Credit Voluntary Disclosure 
Program Option for Repaying ERC Claim. We're   Glad you're joining us today. My name is 
Roy Chaney, and I'm a Senior Stakeholder   Liaison with the Internal Revenue Service. And 
I will be your moderator for today's webinar,   Which is slated for 75 minutes. This webinar 
offers up to one IRS continuing education credit,   Certificates of completion will be emailed to 
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and Stakeholder Liaison staff will assist you and   Answer any questions you may have. As a reminder, 
this webinar will be recorded and posted to the   IRS video portal in a few weeks. This portal is 
located at www.irsvideos.gov. But please note,   Continuing education credit or certificates of 
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presentation, we'll take a few breaks to share   Knowledge-based questions with you. At those 
times, a polling style feature will pop up on   Your screen with the question and multiple-choice 
answer. Select the response you believe is correct   By clicking on the radio button next to your 
selection and then click submit. Some people,   They may not get the polling question. This may 
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the materials drop down arrow on the left side of   Your screen. Again, welcome. We're glad you joined 
us for today's webinar. Before we move along with   Our session, let me make sure you're in the right 
place. Today's webinar is an Employee Retention   Credit Voluntary Disclosure Program Option for 
Repaying the ERC Claim. This webinar is scheduled   For approximately 75 minutes from the top of the 
aisle. So now let me introduce today's presenter.   Today's presenter is Erik Anderson. He is the Team 
Lead for the Employee Retention Credit Voluntary   Disclosure Program. His permanent position, he's 
in the small business self-employed division of   Exams as a Senior Manager. Erik started his career 
with the IRS as a revenue agent in 2004. He became   A Revenue Agent Group Manager in 2008 and a Senior 
Manager in 2020. Erik has worked assignments as   Planning and Special Program Territory Manager, 
Offshore Compliance Group Manager and Technical   Adviser to the Area Director. Prior to starting at 
the IRS, Erik worked in both public accounting and   Corporate accounting. He obtained his CPA license 
in 2002 and his MBA from DePaul University in   2014. Despite living in Wisconsin, Erik is still a 
Chicago sports fan. He likes the bears, the cubs,   And the bulls, and loves deep dish pizza or any 
pizza for that matter. So now I'm going to turn   It over to Erik to begin today's presentation. 
Erik, the floor is yours. Well, thanks, Roy. And   Welcome, everyone. Thanks for joining us today. 
You made an excellent choice in attending. First,   Let's start here with our objective. After the 
today's presentation, I hope you will understand   The many advantages of the Employee Retention 
Credit Voluntary Disclosure Program. Throughout   This presentation, I'll generally refer to it 
as ERC-VDP. You also understand who is eligible   To participate in the ERC-VDP and how simple it 
is to apply. The steps in the process for what   Happens after you apply to ERC-VDP, and then 
lastly, what ERC resources are available to   You. So before we begin discussing ERC-VDP, let's 
first recap some of the IRS's Employee Retention   Credit initiatives that have transpired over the 
last several months. First, we want you to know,   We share your concerns that honest taxpayers have 
been duped by promoters into filing false employee   Retention credit claims. We've been working on 
solutions to help you, including instituting a   Moratorium or pause on claim processing, starting 
up a claim withdrawal program, announcing the   Voluntary Disclosure Program, which is what we'll 
dive into within this webinar. And we've been   Working on a variety of disallowance, audit, and 
educational letters. Amid rising concerns about   A flood of incorrectly claimed Employee Retention 
Credit. The IRS announced back in September 14th,   2023 an immediate moratorium on processing 
new Employee Retention Credit claim. Yes,   We did this to help protect honest small business 
owners and organizations from scams. Well, we have  

An update for you on that moratorium. In January, 
our IRS Commissioner, Daniel Werfel provided the   Senate Finance Committee with a road map for 
how we plan to resume processing of our current   Employee Retention Credit inventory along with 
several new strong fraud detection measures that   Were put into place. Now during the moratorium, we 
expanded transcription efforts and deployed more   Modern scanning technology to identify areas 
of concern to assist in compliance efforts   And really protect against fraud. We're going 
to be completing the transcription of amended   Paper returns with the help of digitalization and 
deploy new risk and analysis strategy to identify   Additional compliance work. Some of these fraud 
protection measures are necessary before we resume   Processing of claims, after that September 14th 
moratorium. A specific resumption date has not yet   Been determined at this point in time. For more 
information on our Commissioner's January update,   You can go ahead and visit IRS.gov/newsroom, 
and look for IRS statements and announcements,   Which will appear on the left-hand side of the 
navigation panel. Withdrawal option, which was   Announced in October 2023, allows employers with 
pending claims, basically claims that have not   Been processed to submit a request to withdraw 
their claim, which will avoid future repayment of   That Employee Retention Credit with any associated 
penalties and interest. In December 2023,   We mailed thousands of Employee Retention Credit 
disallowance letters, the different employers that   Either didn't exist during the time for which the 
credit was being claimed or did not pay W-2 wages   Or that received an erroneous or excessive 
employee retention credit. In January 2024,   We sent more than 3,000 new compliance related 
letters to companies with both processed and   Unprocessed claims, and these efforts are going to 
continue. The Voluntary Disclosure Program allows   Employers with paid claims to repay only 80% of 
the Employee Retention Credit without paying any   Penalties and interest. Now let's talk a little 
bit more about the Employee Retention Credit   Voluntary Disclosure Program process, which 
the IRS announced in December 2023. For those   Who claimed and received the Employee Retention 
Credit, but are uncertain if they were eligible,   They should carefully review program guidelines 
with trusted tax professionals and check the   Employee Retention Credit eligibility checklist, 
which can be found on IRS.gov/erc. If an employer   Claimed and received the Employee Retention 
Credit, but was ineligible, they may be eligible   To apply for the Employee Retention Credit 
Voluntary Disclosure Program. Program is open   Through March 22, 2024. The program requires the 
employer to pay back the Employee Retention Credit   Received minus 20%. Cooperate with the IRS if 
there is any request for additional information,   And sign a closing agreement. The IRS will not 
charge penalties or interest in the amount of   Claimed Employee Retention Credit if you pay it 
back in full, and that is the Employee Retention   Credit less than 20% reduction, and pay it back by 
the time you return your signed closing agreement   To the IRS. The IRS will not examine employee 
retention credit on your employment tax return  

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For tax periods resolved within the terms of 
ERC-VDP. Under ERC-VDP, you do not need to   Repay any interest you received on your employee 
retention credit refund. You do not have to amend   Your income tax returns to reduce wage expense 
either. Now I'm going to talk about several   Advantages of ERC-VDP. There are several benefits 
to using ERC-VDP. I mentioned some on the prior   Slide but let me reiterate. If you receive the ERC 
but weren't entitled to it and now want to pay the   Money back. Some of the advantages of the Employee 
Retention Credit Voluntary Disclosure Program are,   I said, first and foremost, you need to repay only 
80% of the Employee Retention Credit you received   As a reduction in tax on your return or as a 
refund. That's the biggest and key advantage. Our   Commissioner has said you will not get a better 
deal. Additionally, you don't need to repay any   Interest you received on your Employee Retention 
Credit refund. So if you received interest when   You got your ERC refund, none of that has to be 
repaid. You don't have to amend income tax returns   To reduce wage expense for the 20% reduction 
and repaid Employee Retention Credit. That 20%   Reduction in repaid employee retention credit 
is also not taxable as income. The IRS will   Not charge penalties or interest on the Employee 
Retention Credit, assuming it repaid in full, that   ERC minus 20%, by the time you return your signed 
closing agreement to the IRS. And as I mentioned   Before, we won't examine Employee Retention Credit 
on your employment tax return for periods that are   Resolved within the terms of ERC-VDP. As you can 
see, there are several advantages to participating   In this program. Hey, Roy. I believe it's time for 
our first polling question. Thank you, Erik. Yes,   Audience, it is time for our first polling 
question. So the ERC Voluntary Disclosure Program   Requires the employer to? A, pay back 80% of the 
ERC received. B, respond timely to any IRS request   For more information. C, provide information about 
anyone who advised or assisted you with your ERC   Claim. D, sign a closing agreement, or E, all of 
the above. So go ahead. And let me repeat myself.   The ERC Voluntary Disclosure Program requires the 
employer to? A, pay back 80% of the ERC received.   B, respond timely to any IRS request for more 
information. C, provide information about anyone   Who advised or assisted you with your claim. D, 
sign a closing agreement, or E, all of the above.   Okay, audience. Take a minute. Please review 
the question, then click on the radio button   You believe most closely answer this question. 
Go ahead. Make your selection. I'll give you a   Few more seconds. Okay. We're going to stop the 
polling now, and we'll share the correct answer   On the next slide. And the correct response is E, 
all of the above. Let me see. I see that 94% of   You responded correctly. That's a great response. 
That means we're doing well. Erik, I'm going to   Pass it back to you to cover who can apply for the 
ERC-VDP program. Thanks, Roy. So you can apply to   ERC-VDP if all of these factors apply. First, as 
of the announcement date on December 21, 2023,   Your Employee Retention Credit claimed and an 
employment tax return has been processed and paid   As a refund, which you had cashed or deposited or 
was paid in the form of a credit applied to the  

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Tax period or to that tax period or to another 
tax period. Secondly, you now think you're not   Entitled to any Employee Retention Credit for a 
given tax period. For example, you claimed 50,000   Of Employee Retention Credit. And now I realize 
you're not entitled to any of the $50,000 claimed.   Additionally, you want to return the entire amount 
of ERC claim for a given tax period. Just a note,   This is not applicable for partial adjustments for 
a given tax period. Now if you use the third-party   Payer to file your employment tax returns or 
claim ERC, meaning those filings were under a   Third-party payers employer identification number 
and not your business employer identification   Number, you can apply to ERC-VDP yourself. While 
you can still come forward under this program,   You must contact the third-party payer to apply. 
Since they filed using the third-party payers EIN,   They will need to file the application to our 
ERC-VDP also using the third-party payers EIN.   Please know, though, that if somebody willfully 
filed a fraudulent Employee Retention Credit claim   Or if they assisted or conspired in such type of 
conduct, applying to the Employee Retention Credit   Voluntary Disclosure Program will not exempt 
them from potential criminal investigation or   Prosecution. This program is not a replacement 
for criminal investigation Voluntary Disclosure   Program. Now I'll share with you who can't 
apply to the Employee Retention Credit Voluntary   Disclosure Program. So you cannot use the ERC-VDP 
if any of the following apply. First, your ERC   Claim was not processed and paid by 12/31/2023. Or 
if it was paid, the refund check has not yet been   Cashed or deposited. Or you're trying to repay 
only a portion of your ERC. For example, you   Claimed a $50,000 employee retention credit for a 
tax period, but now realized you're only eligible   For 25,000 or your underemployment tax examination 
by the IRS. We'll continue on with who cannot   Apply on the next slide. You also cannot apply to 
ERC-VDP if you're under criminal investigation by   The IRS or if you have reversed your ERC to zero. 
For instance, if you previously filed an amended   Employment tax return to eliminate all of your 
ERC, you generally aren't eligible for ERC-VDP   For the periods you amended or if you received 
a notice or letter from the IRS disallowing the   Entire amount of your ERC. For examples of the 
letters or notices, please review the ERC-VDP   Frequently Asked Questions eligibility section. 
Know that in some situations, you may have   Alternative. For example, if you're not eligible 
to apply for the Employee Retention Credit   Voluntary Disclosure Program because you only need 
to reduce your ERC claim but not eliminate it,   You can still file another adjusted return, for 
example, 941-X to correct it. Another scenario is   If you're not eligible to apply to ERC-VDP because 
your ERC has not yet been paid, you can and should   Consider our ERC withdrawal process. For more 
information on our ERC withdrawal process,   You can go to IRS.gov/erc, then just click on 
the withdraw and Employee Retention Credit claim   Link. All right. Roy, I think it's time for our 
second polling question. Thanks, Erik. Audience,   You know what? It is time for our second polling 
question. So it states, if you are not eligible to  

Apply to the ERC-VDP if, A, your ERC claimed on 
an employment tax return has been processed and   Credited and or paid as a refund; B, your ERC 
claim has not been processed and paid or if it   Was paid, the refund check has not been cashed or 
deposited; C, you now think you were not entitled   To any ERC and want to return 80% of the ERC 
claimed and received for a given tax period or D,   02none of the above. So let me repeat. You're 
not eligible to apply to the ERC-VDP, if A, your   ERC claimed on an employment tax return has been 
processed and credited and or paid as a refund; B,   Your ERC claim has not yet been processed and paid 
or if it was paid, the refund check has not been   Cashed or deposited; C, you now think you were not 
entitled to any ERC and want to return 80% of the   ERC claimed and received for a given tax period 
or D, none of the above. Okay. So, audience,   Take a minute, review the question, then click in 
the radio button you believe most closely answers   This question. Go ahead. Make your selection. 
I'll give you a few more seconds. All right, we're   Going to stop the polling now, and we'll share the 
correct answer on the next slide. And the correct   Response is B, your ERC claim has not yet been 
processed and paid or if it was paid, the refund   Check has not been cashed or deposited and I 
see that 61% of you responded correctly. So,   Erik, I think we may need a little bit more 
explanation and clarification on this issue. Sure,   Roy. And it might be kind of the double negative 
or the negative there. So you're not eligible to   Apply to ERC-VDP. If, the answer is B, your 
Employee Retention Credit claim has not yet   Been processed and paid. And that means that 
it's sitting there waiting to be processed or,   Obviously hasn't been processed. So instead of 
applying to ERC-VDP what you could consider is   The withdrawal process. You are still eligible 
to apply for ERC-VDP if A and C. So, A is if   Your employment tax return has been processed and 
credited, and C, you now think you're not entitled   To any ERC and want to return 80%. So, hopefully, 
that clears it up. All right. It sounded like a   Great explanation to me. So now I'm going to turn 
it back over to Erik so that he can talk about how   You would apply for the ERC-VDP. Thanks, Roy. 
Well, all ERC-VDP applicants need to prepare a   Form 15434. This form is entitled application for 
Employee Retention Credit Voluntary Disclosure   Program. It's a relatively simple form, only a 
page and a half, and we'll touch on the form more   In just a few slides. Your submission package, 
in addition to the 15434 may also need to include   Some other forms. For example, if your application 
includes tax periods ending in 2020, you'll need   To include an SS-10, which is a statute extension. 
You'll include that with your submission. A   Standard SS-10 is available on the ERC-VDP landing 
page. If you need to change your address, use the   Change of a dash Form 8822-B and submit that with 
your 15434. If you want a representative, you may   Use Form 2848. If you want to be considered for an 
installment agreement, you'd need to include Form   433-B and supporting documentation. I'll continue 
on the next slide with how to apply for ERC-VDP.   You want to ensure an authorized person of the 
business or duly authorized Power of Attorney  

Signs your ERC-VDP application and other 
applicable forms. Once the package is complete,   It's submitting, submitted using the IRS Document 
Upload Tool. It needs to be submitted by 59 PM   Local time on March 22, 2024. Please note the 
Document Upload Tool is the only way to submit   Your application for ERC-VDP. There is no Fax or 
mail option available at 02this time. By the way,   If you use a professional payroll company, 
including a professional employer organization,   Certified professional employer organization, 
or some other third-party payer arrangement,   And they filed your Employee Retention 
Credit claim for you, you typically cannot   Apply to ERC-VDP yourself. You must contact that 
third-party payer to apply. The third-party payer   Will need to then submit the relevant pages of the 
Schedule R that were filed with each Form 941 or   941-X on which the taxpayer's third-party payer 
claimed the Employee Retention Credit for their   Client. See the Voluntary Disclosure Program 
Frequently Asked Questions or third-party   Payer section for additional information on that 
topic. All right. We covered how to apply. Now   Let's talk about signing ERC-VDP documents. The 
person who can sign an ERC-VDP application and   ERC-VDP closing agreement depends on the type of 
employer you are. This slide outlines simply who   Can sign based on the entity type. Here, we have 
sole proprietorship, corporation, and partnership.   Continuing on the next slide with who may sign 
document. Here, we have single member LLC and   Trust or estate. Note, as we mentioned before, 
your application may instead be signed by a duly   Authorized Power of Attorney or reporting agent. 
Electronic or digital signatures are allowed. You   Can find more information on these signature 
topics in the Frequently Asked Questions for   The Employee Retention Credit Voluntary Disclosure 
Program, which is again, at IRS.gov/ercvdpfaq. And   Roy, that brings us to our third polling question, 
I believe. Thank you, Erik. Audience, again,   It is time for our third polling question. So 
let's go. All ERC-VDP applicants must prepare A,   Form 15434, Application for Employee Retention 
Credit Voluntary Disclosure Program; B, Form   8822-B, change of an address; C, Form 433-B OIC, 
Collection Information Statement for Businesses;   Or D, All of the Above. Let me repeat again. All 
ERC-VDP applicants must prepare, A, Form 15434,   Which is Application for Employee Retention 
Credit Voluntary Disclosure Program; B, Form   8822-B, change of an address; C, Form 433-B OIC, 
Collection Information Statement for Businesses;   Or D, All of the Above. So, audience, take a 
minute, review the question again, then clicking   The radio button you believe most closely answers 
this question. Go ahead. Make your selection. I'll   Give you a few more seconds. Okay. We're going 
to stop the polling now, and we'll share the   Correct answer on the next slide. And the correct 
answer is A, Form 15434, Application for Employee   Retention Credit Voluntary Disclosure Program. 
And let's see, let's see how well you did with   This question. I see that 64% of you responded 
correctly. So I think, Erik, we may need a little   Bit more clarification. Can you do that for us, 
please? Of course, Roy. So all ERC-VDP applicants  

Must prepare Form 15434. So that's a requirement. 
All applicants, all application packages should   Have that form as a baseline standard form. 
The other components of this question are,   Forms that are only applicable if needed. So 
if you need to change your address, then you   Would attach and include an 8822-B. If you are 
requesting an installment agreement and then you   Would include a 433-B with your 15434. So all 
packages, 15434. Other forms would depend on   The situation that the taxpayer is in. Hopefully, 
that gives a little bit more clarity. Thank you,   Erik. Actually, I think it does. So I'm going to 
go ahead and turn it back over to you so you can   Go cover how to use the Document Upload Tool for 
the ERC-VDP program. Thanks, Roy. Well, you may   Be familiar with using our document submission 
portal, our Document Upload Tool, but here's a   Few steps that are different for ERC-VDP. We've 
outlined all the steps here for you to refer back   To, including specific information for Steps 1 
through 3 and what to expect after you submit your   Documents. So when you go to IRS.gov/dut. You'll 
click on the button, Use the Document Upload   Tool. Then you will acknowledge the authorized 
use statement and the privacy statement. Once   You're on the welcome page, select no with respect 
to the access code question. Then you'd type 15434   To pull up the Form 15434 submission portal. 
Once you're in the 15434 submission portal,   You'll enter your tax year, business name and 
business employer identification number. Now for   Tax year, you'd select the year that correlates 
to the oldest tax period on your Form 15434,   Part 4. So that that would be either 2020 or 
2021. So if your 15434 includes a quarter in 2020,   You'd select 2020. Continuing on with the steps 
on our next slide, you would just click next.   Then you would upload the required documents by 
dragging them or browsing to their location on   Your computer. You can even take a picture from 
your phone and upload that through your phone.   Lastly, click the submit button to transmit the 
documents. Your documents will not be submitted to   The IRS if you don't click the submit button after 
you upload. Key point. After you hit submit, you   Should receive the message, your documents have 
been successfully uploaded. You may be contacted   At a future date regarding your response. You 
should allow at least 30 days for a reply from   The IRS. You should see that message. And for your 
own records, keep copies of all documents that   You've submitted via the Document Upload Tool. 
Now I'll talk about calculating and paying back   The Employee Retention Credit. As we've said, the 
amount of Employee Retention Credit to be repaid   Is 80% of the amount of Employee Retention Credit 
claimed for a tax period that the tax payer now   Agrees they were not entitled to. The amount is 
calculated on Form 15434, application for Employee   Retention Credit Voluntary Disclosure Program. 
If you're applying for ERC-VDP for more than one   Period, you may use one form for all the periods 
you're applying to the program for. However,   Separate payments must be made for each 
period you're applying and returning payment.   For example, if you're applying to the Employee 
Retention Credit Voluntary Disclosure Program for  

Second quarter 2020 and third quarter 2020, you 
can use Form 15434 to apply to the program. But   You should also make a separate payment via EFTPS 
for second quarter 2020 and a separate payment for   Third quarter 2020. Since you're applying to 2020 
tax periods, you would also include an SS-10. Now   When you're using EFTPS, you would select Tax Form 
941, if that's the typical form you use for your   Employment tax filing. The tax type would be Audit 
Adjustment and Advanced Payment of Tax Deficiency.   So continuing on with paying and calculating on 
the next slide. Paying at the time you apply to   ERC-VDP can help speed up processing and resolve 
your case quicker. If payment is impossible by the   Closing agreement date, you may be considered for 
an installment agreement. When submitting ERC-VDP   Application through the Document Upload Tool, 
you also need to complete and submit a Form 433-B   Collection Information Statement for Businesses 
and provide all documentation required to support   The Form 433. This additional information is 
required for the IRS to review and analyze   The proposed installment agreement request. And 
also depending on your facts, the IRS may request   Additional information or forms to be filled 
out. Roy, it looks like it's time for our fourth   And final polling question. Thank you, Erik. I 
appreciate that. Audience, it is time for our   Fourth and final polling question. So let's go. 
The amount of the ERC-VDP to be repaid is, A, 20%   Of the amount of ERC claim for a tax period that 
the taxpayer now agrees they were not entitled to;   B, calculated in Form 15434 application for 
Employee Retention Credit Voluntary Disclosure   Program; C, 80% of the amount of the ERC claim 
for a tax period that the taxpayer now agrees   They were not entitled to or D, both B and C. So 
let me repeat that. The amount of the ERC-VDP to   Be repaid is, A, 20% of the amount of ERC claims 
for a taxpayer that the taxpayer now agrees   They were not entitled to; B, calculated in Form 
15434, application for Employee Retention Credit   Voluntary Disclosure Program; C, 80% of the amount 
of ERC claim for a tax period that the taxpayer   Now agrees they were not entitled to, or D, both 
B and C. Okay. Take a minute, audience. Review   The question again. Click the radio button you 
believe that most closely answers this question.   Please go ahead and make your selection, and I'll 
give you a few more seconds to do so. All right,   We're going to go ahead and stop the polling now, 
and we'll share the correct answer on the next   Slide. And the correct response is D, you need 
both B and C. So let me take a look. Let's see   How well you did with this question. And I see 
that 83% of you responded correctly. But that's   Actually a great response. We're doing very quite 
well. Erik, I'm going to turn it back over to you   For a sample ERC-VDP application. The floor 
is yours. Thanks Roy. Glad to see we're seeing   A higher percentage on our poll. We're coming 
back around. So, anyways, here we have a slide   Showing Form 15434, Application for Employee 
Retention Credit Voluntary Disclosure Program.   You can download this form with its comprehensive 
instructions by searching Form 15434 on IRS.gov,   As you complete it, the amounts on the bottom 
of Page 1 will calculate for you. We've heard  

That some people have had trouble accessing the 
form, so let me try to help mitigate a little bit   Of that. She used this IRS smart form applicants 
must have the current version of Adobe Reader or   Adobe Pro. So you could see the list of resources 
at the end of this presentation for downloading   And printing tips if you need help getting the 
most recent free version of Adobe Reader. To   Download this form from our site, basically, you 
click, you'll right click on the link to the form,   Choose save link as to download the form 
to your computer. Open, fill out, sign,   And save Form 15434. Submit the application form 
and any necessary supporting documents to us   Using the IRS Document Upload Tool. If Adobe does 
present you with a button to enable all features,   You should enable it so the PDF works properly. 
Overall, though, this form is quite simple. You   Populate general information in Part I, such as 
name, EIN, address. Just a reminder, make sure   Your address matches your 941 filings. Otherwise, 
submit a change of address 8822-B. Part II is only   Used if you're a third-party payer. Part III 
is only used if you're, for indicating a power   Of attorney. Part IV, you select from the drop 
down box, the form that you used to file, that   You used to claim your ERC, and then you add the 
amount of non-refundable and refundable Employee   Retention Credit amounts per period. The table 
should then do the remaining calculation. If you   Don't know the exact amount of your ERC refundable 
versus non-refundable amount, you can put your   Best estimations in each tax period as we'll be 
checking and reviewing them all. Then input the   Information on the preparer that you used to claim 
the Employee Retention Credit. Lastly, sign, and   That's it. Submit the document via the Document 
Upload Tool. Also, a reminder, if you have a tax   Period a quarter in 2022, including SS-10 with 
that submission. Now I want to talk about what   Happens after we review your application package. 
Okay. After you've submitted your complete   Application package through the Document Upload 
Tool, we'll review it for completeness. If it's   Complete, we'll mail acknowledgment letter 6614 to 
you. Next, assuming there are no other necessary   Items, we'll mail you a closing agreement. You 
should pay your full ERC-VDP amount per quarter   Or tax period by using EFTPS to avoid any interest 
or penalty charges. After we receive your signed   Closing agreement and payment, we'll adjust your 
account to reflect the eliminated ERC. You do not   Need to submit amended tax returns correct in your 
ERC. Please be aware that the terms of the ERC-VDP   Program closing agreement cannot be appealed. On 
the other hand, if your application is rejected,   The letter 6615 will explain why and offer 
potential solutions. Now I'll share some   Information on how to report Employee Retention 
Credit abuse. So to report Employee Retention   Credit abuse, you can submit Form 14242, which is 
reporting Abusive Tax Promotions and/or preparers.   If you do this, you should submit a completed 
Form 14242 and any supporting materials to the   IRS lead development center. The contact 
information is listed here on the slide,   Also, in our Employee Retention Credit Voluntary 
Disclosure Program frequently asked questions. By  

The way, you don't have to include your contact 
information when you submit this form, you can   Remain anonymous. However, it's helpful if you 
do submit contact information in the case we have   Follow-up questions. Let's move on to resources 
on IRS.gov. Here are resources on IRS.gov on the   Employee Retention Credit Voluntary Disclosure 
Program. General information can be found at   Our landing page IRS.gov/ercvdp. Frequently 
asked questions are at IRS.gov/ercvdpfaq. The   Application Form 15434, can be found there at the 
link on the screen, or just go to IRS.gov site and   Type in 15434 in the search box to find that form. 
All right. So continuing on with resources. Here's   Other Employee Retention Credit information. 
General information on Employee Retention   Credit can be found at IRS.gov/erc. Frequently 
asked questions for Employee Retention Credit,   They're at IRS.gov/ercfaq, withdrawal an Employee 
Retention Credit claim IRS.gov/withdrawmyerc,   And Employee Retention Credit eligibility 
checklist interactive tool can be located   From the link on the slide there or irs.gov/erc 
to locate the checklist interactive tool. And   Audience for your awareness, we have a resource 
document added to the materials tab you can   Download with the links to these resources. This 
concludes my presentation. Now my colleague,   John McInelly, will join us to answer questions 
related to the Voluntary Disclosure Program. Roy,   I'm going to turn it back over to you to 
start the Q&A session. All right. Thank you,   Erik. And we definitely want to appreciate 
Erik for his presentation and information. Q&A Session: Hello again. It's me, audience, Roy Chaney, and 
I'll be moderating the Q&A session. Before we   Start the Q&A session, though, I want to thank 
everyone for attending today's presentation,   Employee Retention Credit Voluntary Disclosure 
Program Option for Repaying ERC Claims. Earlier, I   Mentioned we want to know what questions you have, 
and here is your opportunity. If you haven't input   Your questions, there's still time. Go ahead and 
click on the drop down arrow next to ask questions   Field, type in your question and click send. John 
McInelly will be joining us to answer your ERC-VDP   Questions. John McInelly is the Executive Lead for 
the ERC with the IRS Small Business Self Employed   Division. Let's welcome, John. One thing before 
we start, though, we may not have time to answer   All the questions submitted, but we will answer as 
many as time allows. So let's get started so that   We can get to as many questions as possible. 
So let's see. John, are you with us? Hey,   Roy. Yes. This is John McInelly, ready for the 
questions. So, John, here's our first question   I was able to pull. The ERC-VDP application 
period is right in the middle of tax season and   Is due to close on March 22, 2024. Do you think 
this will be extended? That's a good question,   Roy. We do recognize that we did announce the 
Voluntary Disclosure Program during filing season,   And we have a period in which it's closed as 
March 22nd. There is no consideration to extend   It at this time, March 22nd is the date in which 
applications will need to be filed. Remember that  

We did attempt, as you saw through this, through 
that great presentation that Erik just gave. We   Did attempt to make this as simple as possible, 
by keeping the application to just two pages,   So relatively short. Hopefully, it can, a taxpayer 
can go through it relatively easy. And then,   Of course, once it comes in and it's reviewed, 
we'll be able to have an employee contact the   Taxpayer soon after. So, yes, we recognize it, 
and I appreciate the question. All right. Thank   You. Let's see. Let me pull okay. So we do have 
another one. This if I don't sign a consent form,   Will I be rejected from the program? Yes. Yeah. 
If you fail to sign a consent, that will be,   The application will be rejected from the ERC-VDP 
for the tax year 2020 periods. I'm assuming it's   The statute extension consent. So, yes, you, and 
remember that if you file an application, you want   To make sure you have everything, appropriately 
signed. So there you go. All right. Thank you,   Sir. Let's see. Okay. Here we go. What are 
some of the reasons that an application   Might get rejected? Well, obviously, there's the 
missing required consent. Another thing could be   That the address may not match the one that's on 
file or that the, you don't have the appropriate   Employment tax forms. Another thing could be not 
signing the application itself. So just as you're   Filling out the application, just make sure that 
you're checking and identifying that everything   Is accurate and accurate as it is related to you, 
your employee identification number, your taxpayer   Your tax form type, whether it's 941 or a 944 if 
you're a small business that does the annual filer   For agricultural. There's different forms out 
there. All right. Thank you. Thank you, John. We   Got another one. So this one may be quite simple, 
but my return is waiting to be processed. As long   As I file my claim before December 21, 2023, 
can I still participate in the ERC-VDP program?   So remember that the, to be eligible for the 
Voluntary Disclosure Program, you need to have had   Your ERC processed and paid to you before December 
21, 2023. So if you have a pending claim that has   Not yet been processed, you don't have a check 
in your hand, then you do not want to then the,   You're not eligible for this program. However, 
you are eligible for the withdrawal program, which   Erik went over earlier, and I would recommend you 
look at the IRS.gov/withdrawal or ercwithdrawal.   All right. Thank you. We got another quick 
question. So let's say if I don't have,   EFTPS. And so there, I'm wondering if I can send a 
check instead and not pay electronically. Yes. So   For those of you that are not super familiar with 
employment taxes, EFTPS is the main way to do any   Sort of deposits or repayments towards employment 
tax with the IRS. However, in programs like this   Voluntary Disclosure Program, you can, if you 
choose, submit a check instead. What we would ask   Is that you assure that, for the most efficient 
processing of that check, to have for each tax   Quarter; so if you have three quarters in which 
you're making a withdrawal application on, that it   Would be a separate check for the three separate 
quarters. Okay. Thank you, John. Now that didn't   Make sense, but I do have a follow-up question for 
you. So it says here in the queue. I was looking  

To make an EFTPS payment, so I did want to pay 
electronically. But Form 15434 wasn't an option.   So what do I select? That's a good question. 
There's not a specific drop down in the EFTPS   For Voluntary Disclosure Program. What you would 
select instead is the return that you normally pay   On. So if it's a 941, you could do responding 
to a notice, and there's another option like,   And I can't remember the other option, but it's 
like responding to a notice or making a payment,   But just make sure that it's the right tax period 
and the right tax type. So if it's a 941 for the   Third quarter of tax year '21, make sure that's 
what you're selecting when you go into the system.   All right. Thank you. So and I'm just pulling 
these questions randomly. So I haven't heard from   Anyone on the status of my submission, which was 
sent in, in early January. So when will I receive   A response? So I'm assuming that the requester 
was asking about their application for the   Voluntary Disclosure Program, which again since we 
launched in December, we've received applications   Since then. We're working on getting all of our 
examiners trained so that when they do send the   Letters and reach out, they're fully aware of the 
program and everything else that would be needed.   They're working them now. So if you haven't 
heard from anybody, and you've submitted a   Claim or not a claim, but a disclosure. We do have 
a hotline. It is, it's not – it doesn't give you   Status updates or anything. It's just if you have 
questions, but I'm going to give that number. It's   414-231-2222. Again, this is a phone number. It's 
a recording. You leave a voice mail if you have   Questions about the about your specific voluntary 
disclosure application it is 414-231-2222. All   Right. Thanks, John. Thanks for that telephone 
number. I'm pretty sure, it's helpful. But we   Have – we do have more questions for you. So this 
one states, what happens if I don't cooperate for   Any reason after I submit my application? So 
it's kind of an interesting question there.   So if it – if an applicant applies for Voluntary 
Disclosure Program, but then subsequently decides   That they don't want to provide information like 
information report on the person that prepared   The return or it's a tax year 2020 return and 
they don't necessarily want to sign the consent,   Then you did – but you did provide an application. 
then you're not going to get the benefits of the   Voluntary Disclosure Program, such as only having 
to repay an 80% amount, instead of the full amount   Of ERC as well as the penalty and interest free 
period. So it's just – it's highly encouraged   That when you go back. You look at whether or not 
you qualified for Employee Retention Credit. You   Found that you were not actually eligible. That 
it's – this is the best deal that you can get   In coming into the system through this disclosure 
program, getting the discount, penalty and   Interest free period. So, I'll just leave it at 
that. Okay. It sounds like a great deal. But it's   Another question here that kind of coincides with 
that. So if I'm not able to pay in full, then what   Will happen? So we still encourage you to apply. 
So even if you don't have the ability to pay in   Full. So in addition to, the 20% discount. In 
addition to the penalty and interest free period  

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Up until the closing agreement signed to finality, 
the service will also offer the ability to make a   Payment arrangement with the IRS. It's the general 
installment agreement. I would encourage taxpayers   Or employers that would be considering that 
option to look at the IRS collection process   So they would know what to anticipate. There are 
a couple of forms you'd have to sign and submit   With that, and then we'd have somebody from the 
collection area that would reach out to you. Plus   There's also a Publication 594, that's the IRS 
Collection Process, so it's something to look at,   And to familiarize yourself if you're entering the 
program. But again, if you don't have the ability   To pay even the 80% that you were not eligible 
for the ERC, we still encourage that you apply for   This disclosure program. Again, remember that this 
this program was set out because we want to ensure   That we're helping small businesses and taxpayers, 
who may have been duped or misled by an aggressive   Promoter to be able to come into compliance. Thank 
you, John. Thank you, John. So we do have some   More questions here for you, though. Here's one. 
If I submit my application for the ERC-VDP before   The end date of March 22nd, okay, but I didn't – 
do not receive my closing agreement before March   22nd. Will I still be allowed to participate? You 
say that one more time. I'm sorry. I missed that.   Okay. Let me repeat it. If I submit my application 
for ERC-VDP before the end date of March 22nd,   But I do not receive my closing agreement 
before March 22nd. Will I still be allowed to   Participate? Absolutely. Yes. That March 22nd date 
is the deadline to get your application into the   Document Upload Tool. So you have until midnight 
Eastern, March 22nd to have the application into   The Document Upload Tool. Now I would recommend 
that you do not wait until March 22nd. That as   Soon as you have the information you need, 
which you've identified you’re ineligible,   Which quarters you're ineligible, to file that 
application and start the process as soon as   Possible. But if you do not hear and then just to 
reiterate for that question. If you do not hear,   If you do not receive a notice or a phone call 
from an IRS representative before March 22nd.   That's okay. The deadline is that the application 
must be submitted by March 22nd. All right. Thank   You. Let's see. Okay. So this is pretty intricate. 
My client received a Notice 6577 with the intent   To disallow the ERC to 0 for the tax year of 2020. 
Although this program was adopted in December 22   Of 2023, my client received his notice on January 
2, 2024. So given these circumstances, could he be   Eligible for this program? So, unfortunately, the 
Notice 6577 proposing a disallowance or reduction   Of ERC, which was previously claimed, that would 
be considered the same as if the tax period was   Under audit, in other words, the service had 
identified that the ERC that the taxpayer was   Not eligible for the ERC and has already notified 
the taxpayer. So unfortunately for that taxpayer,   That quarter – that calendar quarter, that tax 
period would not be eligible for the Voluntary   Disclosure Program. However, if there are other 
tax quarters in which the taxpayer still has   Identified has not received the letter, but has 
identified, they're ineligible. They can come  

Into the disclosure program for those calendar 
quarters. So remember that each calendar quarter   Is like its own period, as far as getting 
treatment for the disclosure program. And   That's actually a really good question. I do want 
to make sure that that everybody in the audience   Is aware that the Internal Revenue Service is 
reviewing accounts and is reviewing ERC that has   Been paid out and there was authority, granted to 
the service through the statute that created the   ERC that also allows the service to use all the 
normal collection methods of recapturing, ERC that   Was incorrectly paid out. So in other words, if 
you got an ERC check and you were not eligible for   That ERC, you have this opportunity to come into 
the disclosure program. If you do not, the IRS is   Reviewing accounts and is sending out letters to 
taxpayers, proposing to remove that ERC and to put   Them in an underpayment status in which they will 
no longer be eligible for this disclosure program.   Okay. Now I have another question here, not 
necessarily on the Voluntary Disclosure Program,   But when will the moratorium end? And if so, when 
will businesses who file for the ERC claims from   Around May of 2023 until before the moratorium 
be processed and paid? I'm glad you asked that,   Roy. Every speaking engagement I go to, that 
question comes up, and I understand why. So the   Moratorium is still in effect and that the service 
is still not considered or giving consideration   To claims for ERC that were received on or after 
September 14th. However, we're still holding the   Dates in which those claims have been received, so 
we will eventually get to consideration for those   Returns. Meanwhile, for any taxpayer that filed 
a claim prior to the moratorium that has not yet   Had that processed. Those claims are being looked 
at individually. We did get a very large volume   Of claims this last summer. So due to our limited 
resources, we're reviewing them as fast as we can   To get through and apply the appropriate amount 
of scrutiny to each claim. There are a lot of   Taxpayers that are getting either audit letters. 
There’re taxpayers that are getting disallowance   Letters, and there are taxpayers with eligible 
claims that we identified as eligible in there,   And they're getting, those claims paid out. 
It's just a much slower process. So I ask that,   That the employers continue to have patience 
for those with eligible claims and that because   There was a lot of misinformation pushed by 
aggressive advertisers. I highly encourage   Any taxpayer that is waiting for their claim to go 
into IRS.gov/erc and look through the – and look   To find the eligibility tool and to look through 
that tool or download the publication, if you're a   Practitioner to any of the clients to go through 
and make sure that they're actually qualified   And eligible for the tax periods in which they 
think they are. All right. Thank you, John. But   Since you were talking about the advertisers, 
here's a question for you. This person said,   I've heard a bunch of advertisements about ERC. 
Is the IRS going after some of these advertisers   That may be fraudulent? Absolutely. The IRS is 
working at both the criminal and the civil side   Of identifying pursuing aggressive promoters of 
false and incorrect Employee Retention Credits.  

There are dozen actually, I think hundreds 
now of criminal investigations. There's also,   Quite a few civil investigations that are 
occurring on active promoters. We've also, if   You look at the News Release, we did just send out 
invitations for education sessions that are being   Held by our Criminal Division for high volume 
promoters to ensure that everyone is educated and   Aware of what actually constitutes and qualifies 
as an eligible ERC claim. All right. Thank you,   John. Now I do have, here's another specific 
question. This person filed the 941-X in 2023   For ERC taken on the third and fourth quarters of 
2021. They amended them in 2023 after discovering   That the company should not have taken their ERC 
due to the fact that it was determined to be part   Of a controlled group. Amended return has been 
filed and the taxes repaid. Can I file the new   Form 15434 to request relief of penalties 
and interest? So I'm going to, so that's   A pretty specific question, and I'll sum it up 
to a little bit more of a general answer. So,   For taxpayers who have already reversed ineligible 
ERC, whether it's a portion or the entirety,   Then that's the – that's the finality to that 
claim. So the Voluntary Disclosure Program is only   For employers with that have received ERC, cashed 
the check and have not already reversed out their   ERC. So if you've already reversed out your ERC, 
in that case, because there was you found that you   Were part of a larger like the person submitting 
that question or if there was other reasons. Thank   You. That makes it for you're no longer going 
to be eligible though, for this program. And   Hopefully, that that general answer kind of helps 
clear, not just that specific situation, but all   The general in that realm. Right. I appreciate 
it. I understand totally. So here's a simple one,   Though. When will you get notification that 
the repayment is actually accepted? So if you   Submit your payments, at the same time as your 
application, you should see through EFTPS when   That payment goes through, which is generally the 
next day. As far as receiving acceptance into the   Program that everything's been cleared, you'll 
receive correspondence, and that's going to take   A couple weeks after an examiner goes through 
and reviews. So if everything's clean, clear,   With simple, everything's good on the application, 
then you should be getting a letter. Like I said,   It's a few weeks after submission of the 
application. But as far as payment itself,   It clears EFTPS the next day. All right. Thank 
you, John. Unfortunately, audience, that's all   The time we have for our questions today. I want 
to thank our presenters, Erik, as well as John   For sharing their knowledge and expertise and for 
answering your questions. Before we close the Q&A   Session, though, Erik, can you share some key 
points you want the attendees to remember from   Today's webinar. Of course, Roy. So here's some 
of the key takeaways from today's webinar. Filers   Of the Employee Retention Credit claims that 
have been processed and paid but now believe   They are ineligible can apply to the ERC-VDP 
if they meet the criteria. Again, it's open and   Available until March 22nd, 2024. Key benefits 
of the program included only paying back 80% of  

The Employee Retention Credit they received for 
the claimed tax period, and there's no penalties   Or interest to asserted for the ERC-VDP, amount 
is paid in full. The withdrawal option is still   Available for those Employee Retention Credit 
claims that have not yet been processed and paid,   And withdrawing a claim can help to – can help an 
ineligible taxpayer avoid receiving an erroneous   Refund and having to pay it back possibly 
with penalties and interest. ERC promoters are   Constantly changing their marketing tactics. We 
continue to remind taxpayers to seek out a trusted   Tax professional who understands the complex 
Employee Retention Credit eligibility rules, not   A promoter or marketer who's trying to get a hefty 
contingency fee while taking advantage of honest   Taxpayers. We will continue to partner with tax 
professionals and the small businesses, tax exempt   Communities. That's all I have. Roy, back to 
you. All right. Thanks, Erik. And thanks again to   Both of you. Audience, we're planning additional 
webinars throughout the year. To register for an   Upcoming webinars, please visit IRS.gov, keyword 
search, webinars, and select the Webinars for Tax   Practitioners or Webinars for Small Businesses. 
When appropriate, we will be offering certificates   And CE credit for upcoming webinars. We invite you 
to visit our video portal at www.irsvideos.gov.   There you can view archived versions of our 
webinars. Again, continuing education credits or   Certificates of completion are not, I repeat are 
not offered if you view an archived version of any   Of our webinars on the IRS Video Portal. Another 
big thank you to Erik and John for a great webinar   And for sharing their expertise. I also want to 
thank you, our attendees, for attending today's   Webinars, Employee Retention Credit Voluntary 
Disclosure Program Option for Repaying ERC Claims.   If you attended today's webinar for at least 50 
minutes from the official start time, you will   Receive an IRS Certificate of Completion, that 
you could possibly use with your credentialing   Organization for one IRS CE credit. Again, the 
time we spent chatting before the webinar started   Doesn't count towards the 50 minutes. Audience, 
this is important for you to know Certificates of   Completion will be emailed as a PDF attachment to 
the registration email of qualifying participants   From the email address seen on this slide, which 
is Please add   Our email address to your contacts to ensure you 
receive the email with the certificate. If you're   Eligible for continuing education from the IRS and 
registration information includes your first name,   Last name, and valid PTIN as it appears in your 
IRS PTIN account. Your credit will be posted to   Your IRS PTIN account. If you're eligible for 
continuing education from the California Tax   Education Council, your credit will be posted to 
your CTEC account as well. If you qualify and have   Not received your certificate and or credit by 
February 27th, use the email us that email again   Is as again seen 
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may send us an email using the address shown on   This slide, and we'll send you that information. 
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