On Sep. 26, US IRS reported third-party supplemental claims process.
US IRS announced new process for payroll companies and third-party payers (TPPs) to help clients resolve incorrect claims for the Employee Retention Credit (ERC).
Also provided process for filing supplemental claim, and FAQs for third-party payers.
Third-Party Payers
Report and pay client federal employment taxes under third-party payer's employer identification number (EIN); will handle client's payroll and tax reporting duties.
Some third-party payers file employee retention credit claims for multiple employers.
If the third-party payer’s client has since determined it is ineligible for the ERC and wants to resolve their claim, it is the third-party payer that needs to correct it.
Supplemental Claim Process
Process will allow third-party payer that filed a prior claim with multiple clients withdraw only some clients while maintaining the claims of the qualifying clients.
Supplemental claim is adjusted employment tax return that allows TPP to correct, consolidate previous claims filed on/before Jan. 31, 2024, if claims not yet processed.
For TPP which filed one or more claims aggregating ERC for itself and/or clients using TPP’s EIN; made claim on adjusted employment tax return; if IRS has not processed.
Process not for common law employers who did not use a third-party payer, instead filed adjusted employment tax returns using own Employer Identification Number.
Supplemental claim becomes sole adjusted employment tax return for the tax period.
Review supplemental claim instead of adjusted employment tax return filed by Jan. 31.
Effectiveness
TPPs can submit supplemental claim using computer, mobile device by Nov. 22, 2024.
