One of those "ERC" companies

[JackieCPA]

I had a client have the employee retention credit completed by one of those "ERC" companies that charge a % of the credit as their fee. They are recommending that my client doesn't amend their prior year tax return because the IRS is absolutely going to change their mind and make it tax free. Reading everything I have read; I really don't think they are going to make it tax free (not reducing the expense). 

What is everyone's stance on this. I would rather amend the return now before I do the 2022 return. 

[Lee B]

I would also be concerned about whether your client obtained a PPP Loan during the same time frame or any of the other pandemic  payroll related credits,

because you can't use the same payroll dollars twice and double dip.

[JackieCPA]

I agree - I do not think this company took PPP loans into consideration. 

[BulldogTom]

20 hours ago, JackieCPA said:

What is everyone's stance on this. I would rather amend the return now before I do the 2022 return. 

It is malpractice on the part of the ERC company to tell a client not to file a return that will show a balance due.   The ERC company does not want the client to see the "true" cost of the ERC because they will know that the fee they paid as a percentage of the net they got is not what was advertised.

Your client should report this to the IRS.   They won't, but they should.

Tom
Longview, TX

[Lion EA]

[Note: I luckily had no client do this.]

I would amend the years for which they received ERC now, so they know how much they owe. If they received the ERC monies, I'd e-file immediately, with direct debit or other payment arrangement. Otherwise, I'd hold the returns until the client receives the ERC monies and have them sign then, and I'd e-file. If they have both 2020 and 2021 ERC, those monies probably will arrive at two different times, so I'd e-file each amended return on its own schedule.