Deadline for ERC Voluntary Disclosure Program: March 22, 2024

March 22nd is the deadline for taxpayers to apply for the Employee Retention Credit Voluntary Disclosure Program (VDP). The IRS has provided the opportunity for employers who received the credit but who later determined that they were ineligible for the ERC to voluntarily repay the credit at 80% of the credit received.

The benefits and requirements of the program are:
• Voluntary repayment of 80% of the credit received (versus 100%), without interest, and the 20% of relief received and kept would not be considered taxable income to the self-disclosing employer.
• The IRS will not assess penalties or interest on the ERC payment if the 80% is paid in full by the time the closing agreement is signed.
• Further, under this program, the employment tax return (941) won’t be examined for the ERC for the tax periods reported through the VDP.
Other items on the return are still subject to examination.

Entities who are currently under examination or criminal investigation by the IRS are not eligible for the VDP.

The VPD is for companies who have already received the ERC. If a company has filed an ERC and it has not been processed, and the company believes they are not eligible, a Form 941-X to adjust the claim should be submitted to the IRS.