The IRS recently issued final regulations and guidance for COVID-19-related employment tax credits. Specifically, the regs provide that businesses that erroneously received additional refunds in excess of what they were entitled to may be assessed underpayment penalties. This involves the Employee Retention Tax Credit, the Qualified Paid Sick Leave Credit and the Qualified Paid Family Leave Credit. According to the IRS, this also applies to third-party payors claiming the credits on behalf of employers. Affected business taxpayers must repay the erroneous refunds. The final regs went into effect on July 24, 2023. Contact us for additional information.
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