IRS Remains Focused on PPP and ERC Fraud Heading Into 2025

It’s hard to believe, but it has now been five years since COVID-19 started making headlines around the globe. A lot has happened since that time. During the pandemic, the federal government launched several relief programs, and not long after, it began raising concerns about widespread fraud. As Washington D.C. criminal tax lawyer Kevin E. Thorn, Managing Partner of Thorn Law Group, explains, uncovering and prosecuting pandemic-era fraud remains a top priority for the Internal Revenue Service (IRS) heading into 2025.

The IRS is Continuing to Aggressively Target PPP and ERC Fraud

Even though the Paycheck Protection Program (PPP) and Employee Retention Credit (ERC) program both ended in 2021 (although eligible businesses can still claim the ERC into 2025), the IRS is continuing to aggressively target fraud under both of these programs. The IRS stated as much in a News Release earlier this year, and recent IRS Criminal Investigation (IRS CI) News Releases have touted indictments, guilty pleas, and convictions in PPP and ERC fraud cases.

Despite this, the IRS’ efforts to combat PPP and ERC fraud are still in their relatively early stages. While the IRS reported investigating nearly $9 billion in suspected pandemic-era fraud in March, official estimates put the total value of fraud under the PPP, ERC, and other pandemic-era programs at more than $2 trillion.  

What Should You Do if You Have Concerns?

With this in mind, what should individuals and businesses do if they have concerns about facing PPP or ERC-related scrutiny?

Given that PPP and ERC fraud remain top enforcement priorities for the IRS and IRS CI heading into 2025, taxpayers who have concerns need to address their concerns proactively. What does this mean? The short answer is, “It depends.” The IRS’ limited-time ERC Voluntary Disclosure Program closed on November 22, 2024. However, taxpayers may still be able to resolve both PPP and ERC-related concerns under IRS CI’s long-standing Voluntary Disclosure Practice.

Submitting a voluntary disclosure can be risky though, and it does not guarantee immunity from prosecution. It also is not an option in all cases. When submitting a voluntary disclosure is ill-advised (or is not on the table), deciding what to do will require strategic consultation with an experienced Washington D.C. criminal tax lawyer.

In all cases, taxpayers who need to resolve issues under the PPP or ERC (or both) must be prepared to pay what they owe—or else seek to negotiate a settlement agreement or offer in compromise with the IRS. While taxpayers can settle their debt with the IRS in a wide range of circumstances, this also requires experienced legal representation.

Schedule a Confidential Consultation with Washington D.C. Criminal Tax Lawyer Kevin E. Thorn

If you need to know more about what you can do to avoid facing PPP or ERC-related scrutiny, or if you are currently facing an audit or investigation, we encourage you to contact us promptly. To schedule a confidential consultation with Washington D.C. criminal tax lawyer Kevin E. Thorn, Managing Partner of Thorn Law Group, call us at 202-349-4033 or tell us how we can get in touch online today.