Cheats and scammers still raking in pandemic funds
The federal government ramped up the printing presses during the pandemic, throwing cash around like the proverbial drunken sailor. While much of that aid helped businesses and individuals navigate unprecedented shutdowns, a significant portion of the money went up in smoke.
One of the COVID-era measures federal lawmakers created is the Employee Retention Credit, intended to provide tax breaks to companies that continued to pay their employees during the pandemic. The measure was projected to cost $55 billion, but has so far cost four times that amount (and rising), according to The Wall Street Journal. Another estimate puts the total cost at $550 billion. In addition, the IRS is investigating fraudulent claims in the billions of dollars.
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The Employee Retention Credit was catnip to con artists. Bogus firms sprung up offering to help businesses claim the credit for a percentage of the take (you may have heard them in TV or radio ads). The IRS issued warnings to business filers, urging them to use only reliable tax professionals rather than “a promoter or marketer hustling to get a hefty contingency fee.”
The problem is that the law allows businesses to file for relief as many as four years after the fact, all the way through tax year 2025. As of December, the IRS had more than 1 million back claims pending. T
The pandemic is over. Why are temporary measures intended to blunt the economic destruction wrought by COVID still draining taxpayers and lining the pockets of cheats and scammers?
—Las Vegas Review-Journal/TNS
