New Update: Understanding Your Letter 6612.
The IRS escalated its verification efforts for Employee Retention Credit (ERC) claims. Businesses that submitted ERC claims are now under even closer scrutiny and are being asked to quickly submit detailed documentation to prove that they were rightfully entitled to the credit.
Issuance of Letter 6612 marks the start of an IRS audit into your organization’s tax filings, specifically items related to ERC claim verification. The IRS will place ERC claim refunds on hold until they get the results of this audit.
The IRS’s request spans a range of information aimed at assessing the legitimacy of ERC claims. Businesses must submit a wide range of documentation to prove eligibility for the credits being claimed. Documentation could include, among other items, gross receipts reconciliation to demonstrate the necessary decline and/or copies of governmental orders to prove that operations were fully or partially suspended (to a significant extent) due to a government-mandated closure. The IRS is requesting the information in a relatively short window to further test the validity of credit claims.
This continued rigorous approach by the IRS highlights the increased scrutiny on ERC claims, forcing businesses to act quickly to substantiate their eligibility. For a deeper dive into how businesses can effectively respond to the IRS’s focus on ERC claims and navigate the challenges of an audit, read more in our detailed blog post.
How to Get Started
The IRS encourages businesses to review this letter with their tax professional to verify eligibility and ensure the accuracy of their ERC calculations. Freed Maxick is available to help review the validity of your outstanding ERC claim and help interpret and work through your Letter 6612 and help prepare the necessary documents requested by the IRS. To reach out to our team directly or for a comprehensive understanding of the Employee Retention Credit, click here to download our detailed guide.
Discover more from reviewer4you.com
Subscribe to get the latest posts to your email.
