Announcement 2024-30: Second voluntary disclosure program for employee retention credit

The IRS today announced a second voluntary disclosure program for taxpayers to resolve refunds or credits for erroneous employee retention credit (ERC) claims.

Announcement 2024-30 explains taxpayer eligibility criteria, terms, and procedures for taxpayers electing to participate in the second voluntary disclosure program.

According to a related IRS release—IR-2024-213:

• Interested employers must apply to the second ERC voluntary disclosure program by November 22, 2024.
• Applicants accepted into the program will need to repay only 85% of the credits they received.
• The program is open for tax periods in 2021. Employers can’t use the second VDP to disclose and repay ERC money from tax periods in 2020.
• The IRS will not charge program participants interest or penalties on any credits they timely repay. 
• If an employer can’t repay the required 85% of the credit at the time they sign their closing agreement, they’ll be required to pay penalties and interest in connection with an alternative payment arrangement such as an installment agreement.

A second IRS release—IR-2024-212—explains that the IRS plans to mail up to 30,000 new letters to reverse or recapture potentially more than $1 billion in improper ERC claims. 

The IRS in December 2023 announced the initial ERC voluntary disclosure program.