To increase the penalties applicable to persons facilitate fraud with respect to any COVID-related employee retention credit, and for other purposes.

Summary

This bill increases the penalty for aiding and abetting the understatement of tax liability with respect to the employee retention tax credit (ERTC) by a COVID-ERTC promoter, extends the time period for assessing and collecting tax attributable to the understatement, and disallows the ERTC after January 31, 2024. Under the bill, a COVID-ERTC promoter may be liable for the greater of $200,000 ($10,000 for a natural person), or 75% of the amount derived from the aid, advice, or assistance related to a COVID-ERTC document that understates a taxpayer’s tax liability. Under current law, the penalty for knowingly aiding and abetting in the understatement of tax liability is $1,000 for an individual return or $10,000 for a corporate return. The bill defines a COVID-ERTC promoter as any individual, trust, estate, partnership, association, company, or corporation that provides aid, assistance, or advice related to a COVID-ERTC document for a contingency fee and with gross receipts derived from providing aid, assistance, or advice related to a COVID-ERTC document exceeding a specified threshold.  A COVID-ERTC document is any return, affidavit, claim, or other document associated with a ERTC claim related to COVID. The bill extends the time period for assessing and collecting any tax liability associated with an understatement of tax liability related to the ERTC from five to six years. Finally, under this bill, claims for the ERTC related to COVID must be filed on or before January 31, 2024. 

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Timeline

1. 20 September 2024

   Introduced

   Referred to the House Committee on Ways and Means.

   Source: IntroReferral

2. 20 September 2024

   Introduced

   Introduced in House

   Source: IntroReferral

3. 20 September 2024

   Introduced

   Introduced in House

   Source: IntroReferral

Votes

No vote records are attached yet.

Versions

• Introduced in House · 20 September 2024 · Download file

Documents

3 official files

• Introduced in House (text)

  Introduced in House · EN · 20 September 2024

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• Introduced in House (PDF)

  Introduced in House · EN · 20 September 2024

  ViewDownloadOpen at official source

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  summary · EN · 20 September 2024

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Sponsors

• Rep. Schweikert, David [R-AZ-1] · R · Sponsor
• Rep. Kelly, Mike [R-PA-16] · R · Cosponsor
• Rep. Golden, Jared F. [D-ME-2] · D · Cosponsor
• Rep. Grothman, Glenn [R-WI-6] · R · Cosponsor
• · hswm00 · Standing

Related records

• related to → Tax Relief for American Families and Workers Act of 2024