A COVID era program is awash in fraud. Congress aims to wind it down and expand the child tax credit

This article discusses the high level of fraud in the employee retention tax credit program, established during the COVID-19 pandemic to incentivize businesses to retain workers. A whistleblower estimated that 95% of claims for this tax break were fraudulent, prompting Congress to take action to wind down the program. Demand for the credit increased as Congress extended and expanded it, leading to aggressive marketing tactics and a ballooning cost to the federal government. Lawmakers across the political spectrum agree that the program needs to be ended due to the rampant fraud and lack of oversight. The article also highlights the plans to use the savings from winding down the program to offset the cost of business tax breaks and expand the child tax credit for low-income families. The expansion of the child tax credit would provide significant tax cuts for eligible households.

What’s going on here?

Congress is working to wind down the employee retention tax credit program due to widespread fraud. A whistleblower report suggested that the majority of claims for this tax break were fraudulent, leading lawmakers to realize the need for action. The program was originally established as an incentive for businesses to retain workers during the pandemic. However, the extension and expanded availability of the credit resulted in aggressive marketing tactics and a significant increase in fraudulent claims. Lawmakers from different political backgrounds are united in their agreement that the program should be ended due to the high levels of fraud and inadequate oversight.

What does this mean?

The high levels of fraud in the employee retention tax credit program have prompted Congress to take steps to wind it down. This means that businesses will no longer be able to claim this tax break, and the program will be discontinued. The whistleblower report confirming the widespread fraud has brought attention to the lack of proper oversight and loose standards in the program. Lawmakers are concerned about the ballooning cost to the federal government and the negative impact on legitimate businesses. The focus now is on ensuring that the program is brought to an end effectively and efficiently.

Why should I care?

You should care about this issue because it involves taxpayer money and the misuse of funds. The widespread fraud in the employee retention tax credit program means that a significant amount of taxpayer money has been wasted. This ultimately impacts the economy and could lead to funding cuts in other areas. Additionally, the winds of change are taking place as lawmakers seek to wind down this program and introduce new initiatives. The article also highlights the plans to use the savings from ending the program to expand the child tax credit for low-income families. This could potentially benefit millions of children and provide much-needed support to struggling families.

For more information, check out the original article here.