You are currently viewing How the Employee Retention Tax Credit Became a Magnet for Fraud

The Employee Retention Credit has spawned a cottage industry of firms claiming to help businesses get stimulus funds, often in violation of federal rules.

In early February, federal prosecutors in Utah accused Zachary Bassett and Mason Warr of cheating the United States government out of millions of dollars. The accounting firm they operated had submitted more than 1,000 fraudulent tax forms to the Internal Revenue Service on behalf of businesses trying to claim pandemic-era stimulus funds, the prosecutors said.

COS Accounting and Tax shut down later that month, leaving businesses and taxpayers who had paid the firm to help them claim federal money trying to figure out what had happened and why they were suddenly receiving audit notices from the I.R.S.

Amid the onset of the pandemic in 2020, as large swaths of the economy went into lockdown, Washington set up various programs to help keep businesses and their workers afloat. Among them

Keep reading this article on The New York Times Business.

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