Employee Retention Credit

ERC Audit or Denial? Your Claim May Still Be Viable.

Defend legitimate ERC claims through IRS audit and examination
Appeal ERC disallowance letters and demand for repayment notices
Pursue Tax Court litigation when the IRS wrongly denies your claim
Evaluate ERC Voluntary Disclosure Program options for uncertain claims

The IRS is aggressively auditing and denying ERC claims. Schedule a consultation to discuss your options — including appeal and Tax Court litigation.

Total ERC claims filed with the IRS

$ 0 B+

Penalties & interest eliminated

0 M+

Estimated improper claim rate (IRS)

0 %+

Appeal victories across practice areas

$ 0 M+

The IRS Is Denying Legitimate ERC Claims — and Many Can Be Saved

The IRS has initiated a massive compliance campaign targeting Employee Retention Credit claims. Many legitimate claims are being denied alongside fraudulent ones. If you’ve received a disallowance letter, a demand for repayment, or are under audit, you have rights — and time-sensitive deadlines to protect them.

Whether your ERC claim was denied, you’re under examination, or you’re considering voluntary disclosure for a claim you’re unsure about, experienced tax counsel can make the difference.

ERC Defense Services

IRS enforcement on ERC claims follows a predictable escalation path — from initial examination to disallowance, Appeals, and if necessary, litigation. Each stage requires a different strategy, and the decisions made at the audit level directly affect what options remain available later.

Audit Defense

ERC Audit Defense

Representation during IRS examination of ERC claims. We respond to information document requests, prepare eligibility documentation, and defend your credit against proposed disallowance.

Appeals

ERC Disallowance Appeals

When the IRS issues a final disallowance, we file formal protests with the IRS Office of Appeals and negotiate settlements that preserve all or part of the credit.

Litigation

ERC Litigation

When Appeals fails to produce a reasonable resolution, we litigate ERC disputes in U.S. Tax Court, Court of Federal Claims, or federal district court to protect your refund claim.

Voluntary Disclosure

ERC Voluntary Disclosure

If your ERC claim was improper, the IRS Voluntary Disclosure Program allows you to return the credit with reduced penalties — but the window is limited and the process requires careful navigation.

ERC Eligibility & Qualification

The central question in every ERC dispute is whether the business actually qualified for the credit. The IRS is scrutinizing two primary eligibility paths — full or partial suspension of operations due to a government order, and significant decline in gross receipts. Most enforcement actions target the government order test, where promoters applied overly broad interpretations that the IRS now rejects.

Eligibility Analysis

ERC Eligibility & Qualification Guide

Understanding which eligibility path applies to your business is the foundation of any ERC defense. We analyze your specific facts against IRS guidance to determine whether your claim is defensible.

What to Expect When You Work With Us

You’ll speak with someone who understands tax law. Not a receptionist or a call center. You’ll be speaking with a trained member of our intake team who can meaningfully assess your situation.

We’ll evaluate your options — honestly. We’ll discuss your situation, explain what’s at stake, and outline the realistic paths forward. If we’re not the right fit, we’ll tell you that.

There is no obligation to engage our firm. The consultation is free and completely confidential. No engagement fees until we’ve discussed your situation and mutually agreed on a path forward.

Common ERC Issues Under IRS Scrutiny

The IRS has identified specific patterns and claim types that trigger examination. Understanding which issues the IRS is targeting — and how they evaluate each one — is critical to mounting an effective defense.

Government Orders

Partial Suspension Claims

The most disputed eligibility path. The IRS challenges whether a government order caused more than a nominal impact on your business operations — and whether the order actually applied to your industry.

Revenue Test

Gross Receipts Decline

Claims based on the significant decline in gross receipts test require precise quarter-over-quarter comparisons. The IRS examines whether receipts were calculated correctly and whether the decline threshold was actually met.

Promoter Issues

Third-Party Preparer Claims

Claims filed by ERC mills and third-party promoters are the primary enforcement target. If a promoter filed your claim with inadequate documentation or false eligibility analysis, you — not the promoter — face the IRS consequences.

Wage Calculations

Qualified Wage Errors

Even when eligibility is established, the IRS examines whether qualified wages were calculated correctly — including large employer vs. small employer distinctions, aggregation rules, and related-party wage exclusions.

Coordination Rules

PPP & ERC Overlap

Wages used for PPP loan forgiveness cannot also be claimed for ERC. The IRS is auditing businesses that double-counted wages across both programs, resulting in credit disallowance and penalty exposure.

From Our Practice

$100M+

In ERC exposure defended across all client matters. That includes IRS audit defense, disallowance appeals, voluntary disclosure negotiations, and penalty abatement for businesses that filed ERC claims between 2020 and 2023.

What makes the difference: ERC defense requires both tax controversy expertise and a deep understanding of the underlying eligibility rules. We analyze the specific government orders, revenue data, and wage calculations for each client — not generic arguments that the IRS has already rejected hundreds of times.

Representative Results

What Our Clients Achiev

$2.1M Preserved

ERC claim sustained in full after IRS examination — eligibility documentation and government order analysis accepted

75% → 0%

Fraud penalty eliminated through voluntary disclosure — client repaid credit with no additional penalties assessed

$850K Recovered

Disallowed ERC claim reversed on appeal — partial suspension eligibility established through government order documentation

Sam Brotman

Owner & Managing Attorney · J.D., LL.M. Taxation, MBA

Sam founded Brotman Law in 2013 with a singular focus on tax controversy and tax strategy. He leads the firm’s IRS audit defense and criminal tax practice, and personally oversees every client engagement from initial consultation through resolution.

Not Sure Where to Start?

(619) 378-3138

Want to learn more first? See our transparent pricing or browse our free tax guides.

Common Questions

ERC FAQs

My ERC claim was denied. What are my options?

You can appeal the denial through the IRS Office of Appeals, and if that fails, petition the U.S. Tax Court. There are strict deadlines — typically 30 days for an appeal and 90 days for Tax Court. Don’t accept a denial without exploring your options.

What if I already received my ERC refund and now the IRS wants it back?

The IRS can audit and recapture ERC refunds that were already paid. However, you have the right to defend your claim through the audit process, appeal, and Tax Court. The fact that the IRS paid the refund initially doesn’t mean they’ll automatically win it back.

Should I consider the ERC Voluntary Disclosure Program?

If your ERC claim was filed by a third-party promoter and you’re unsure whether it was legitimate, voluntary disclosure may allow you to repay a portion of the credit without penalties or criminal exposure. We can evaluate whether this program makes sense for your specific situation.

How long do ERC audits take?

ERC audits typically take 6-18 months from the initial contact letter to resolution. The timeline depends on the complexity of the claim, the quality of documentation, and whether you pursue appeal or litigation.

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Get Started Today

Book Your Free 15-Minute Call

Schedule a brief call with our team to discuss your ERC matter. We’ll assess your claim, evaluate your defense options, and outline next steps — confidentially and without obligation.

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We respond within one business day. Most calls returned same day. Everything you share is completely confidential, protected by attorney-client privilege.