OSHA guidance isn't considered an ERC suspension order according to IRS' new GLAM

Wait so if my business claimed ERC because we followed CDC and OSHA recommendations to maintain social distancing and had some employees work remotely, that wasn't actually qualifying? My "ERC specialist" said that counted as a partial suspension! How would I know if my claim is at risk?

If your ERC claim was based ONLY on following OSHA or CDC recommendations, then yes, your claim could be at risk. A qualifying governmental order needs to have actually limited your commerce, travel, or group meetings in a way that suspended at least 10% of your business operations. General safety guidance doesn't count. The best way to determine if your claim is at risk is to gather all documentation about why you claimed ERC and have it reviewed by a reputable CPA or tax attorney who isn't selling ERC services. Look specifically for actual governmental orders (state/local shutdown orders, capacity restrictions) that directly impacted your business operations.

How does this tax.ai thing actually work? Does it just look at your documents and tell you if you qualify? I'm worried my accountant may have been too aggressive with our ERC claim and now I'm freaking out after seeing this GLAM.

Sounds like another AI tool that overpromises. How can it possibly know the specifics of your local government orders? There were thousands of different orders across different jurisdictions. I'm skeptical it could accurately determine qualification better than a tax professional who specializes in this area.

It analyzes your uploaded tax documents, financial statements, and any governmental orders you provide. The AI identifies potential issues by comparing your situation to specific IRS requirements. It's incredibly thorough - it examines the exact language of orders that affected your business and determines if they meet the suspension test. The system doesn't just make blanket determinations. It provides a detailed analysis explaining which aspects of your claim are supported by evidence and which might be questionable. It's not replacing professional judgment - it's providing an unbiased second opinion that isn't motivated by commissions from filing claims.

How does this service even work? The IRS phone lines are notoriously impossible to get through. Is this some kind of special access or connection? I'm suspicious that anyone can actually help with this.

This sounds like a scam. There's no way any service can guarantee getting through to the IRS faster than normal citizens. They probably just keep dialing and charge you for the privilege. I'll stick with waiting on hold for hours like everyone else.

The service uses an automated system that continually redials and navigates the IRS phone tree until it secures an agent. When it gets through, it calls you and connects you directly to that agent. It's basically doing what you'd do manually but with technology that can keep trying constantly. They don't have special access or inside connections - they're just using technology to handle the tedious part of getting through the phone system. And no, there's no guarantee, but in my experience and many others I've talked to, it works consistently. The alternative was spending hours of my workday on hold, which was costing my business more in lost productivity.

Basically, the IRS is saying that just following OSHA safety recommendations during COVID (like social distancing, masks, extra cleaning) doesn't count as a "government order" that suspended your business operations - which is one of the requirements to qualify for the Employee Retention Credit. A lot of sketchy ERC "specialists" were telling business owners that following these safety guidelines qualified them for the credit when it actually doesn't. You need to have been subject to a specific government order (like a shutdown order or capacity restriction) that actually suspended your operations in a meaningful way.

Thanks for explaining! Now I'm even more worried because I think that's exactly what my claim was based on. My accountant said that because we followed OSHA guidelines and had to modify our workflows for safety, we qualified. Do you think I should amend my returns now or wait to see if I get audited?

I'd recommend talking to a qualified tax professional (NOT whoever told you to claim ERC based on OSHA guidelines) as soon as possible. Generally, it's better to amend before you get audited, as it shows good faith and may reduce penalties. The IRS has a special program for withdrawing or correcting dubious ERC claims. You'll still have to pay back any credits you received, but you might avoid some of the penalties and interest if you amend voluntarily rather than waiting for an audit. Document everything about who advised you to make the claim and what they told you about qualification.

Exactly! My friend who runs a restaurant got convinced by one of these "specialists" to claim ERC based on dining capacity restrictions, which was legitimate. But then they pushed him to claim additional quarters when only OSHA guidance was in effect. Now he's worried about what will happen and the ERC company is nowhere to be found. They already took their 20% fee!