Important Update: IRS Lifts ERC Moratorium

Nearly a year after halting new Employee Retention Credit (ERC) claims, the IRS officially lifted its moratorium on August 8, 2024. The pause, which began in September 2023, was designed to combat a surge of improper claims and strengthen compliance reviews. With the moratorium lifted, employers can once again submit new ERC filings—but with tighter rules and increased scrutiny.

What Changed

• New claims allowed: Employers may file ERC claims again, but must follow updated procedures.

• More oversight: The IRS has implemented stricter review protocols to identify aggressive or fraudulent claims.

• Compliance focus: Employers are reminded they are responsible for the accuracy of their claims, even if filed by third-party preparers.

What Employers Should Do

• Confirm eligibility: Review shutdown orders, revenue tests, and qualified wages before filing.

• Document everything: Maintain records that clearly support your claim in case of audit.

• Be cautious of promoters: Avoid firms promising “guaranteed refunds” without properly analyzing eligibility.

Looking Ahead

While the moratorium has ended, the IRS has made clear that enforcement will remain strong. Pending claims continue to face longer review timelines, and improper claims could lead to penalties or repayment. Businesses considering new ERC filings should work with trusted tax advisors to ensure compliance.