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Navigating ERTC Audits: Key Considerations for Mandate Qualification

A Conversation With Joshua Massoud, J.D., Managing Partner


As audits gain momentum on Employee Retention Tax Credit (ERTC) claims, my schedule has become filled with meetings involving Certified Public Accountants (CPAs) and their clients seeking guidance on the requirements for filing necessary adjustments to income tax returns for the years 2020 and 2021. These discussions primarily revolve around the qualification for mandates related to the ERTC.



Common questions in these meetings revolve around mandate-related qualifications:

  1. Did your firm provide a thorough explanation of the mandate qualification requirements?

  2. Did you simply fill out a form and rely on the firm to process your claim?

  3. Which specific mandates were you claiming had an impact on your business?

  4. How did the firm assess whether you were subject to the mandate, including the relevant time period, and determine its impact on your business?

  5. Did the firm provide you with a generic list of potential mandates applicable to your state, or did they tailor it to your unique circumstances?

  6. Did the firm ask you to complete a 'statement of facts' without clearly linking it to specific mandate(s)?

  7. When you mentioned that a 'tax attorney' signed off on it, what exactly did they review and approve?

  8. Did the firm consider both foreign mandates and domestic/U.S. Federal/State/Local mandates in evaluating your eligibility?

  9. Are you relying on non-binding guidance or enforceable mandates subject to punishment or penalties?

Dallas Tax Attorney, Joshua Massoud, J.D. Tax Partner at Tax Credit Collective


The Importance of Comprehensive Discussions

Initially, I anticipated more resistance and challenges during these conversations. However, it appears that businesses are beginning to comprehend the significance of ERTC audits. While some businesses are indeed eligible for the ERTC, others are not.


It is crucial to engage in conversations that cover the topics mentioned above. Failing to address these critical aspects may necessitate taking remedial steps to rectify any potential non-compliance. As the intensity of ERTC audits increases, understanding the intricacies of mandate qualification becomes paramount.


Navigating ERTC Audits

By addressing the questions outlined in this blog, businesses can ensure they are well-prepared and compliant with the necessary requirements.

Consultation with knowledgeable professionals is essential to successfully navigating ERTC audits and taking appropriate action, where needed, to safeguard your business's interests.



Determining if the credit is applicable necessitates comprehending the related law and the IRS guidance, which covers over 150 pages. One option for qualifying is the straightforward gross receipts test, but the other one is much more intricate and includes 71 FAQs regarding various taxpayer situations.


For most business owners, wading through the details to properly calculate eligibility and take in all the tax law intricacies is not possible with their existing workload.

Our team at Tax Credit Collective has spent many hours breaking down the IRS’ memos and FAQs… so much so that we refer to scenarios presented in the FAQs in casual ERC conversations.


With Tax Credit Collective, you can benefit from our 20 years of tax credits experience, our proven track record, and the peace of mind of having a licensed tax attorney provide audit defense, allowing you to confidently claim the Employee Retention Credit. To contact our team please get in touch with us here or give us a call at 214-414-9881.


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