LAFAYETTE, La. (KLFY)– The Internal Revenue Service is warning about scams revolving around the Employee Retention Credit. Employee Retention Credit is a tax credit for business that continued to pat employees during the COVID-19 Pandemic or experienced significant decrease of income.

Although most eligible companies have already claimed this credit, scammers are still targeting some businesses by advertising unethical ERC services to ineligible businesses.

Chris Babin with the Better Business Bureau of Acadiana says scammers are pretending to be experts, claiming to be able to help businesses get a tax break. If a business falls for the scam, their employees’ personal information is vulnerable.

“They’re trying to get those employees’ personal information like their social security numbers, in order to help make sure that they’re eligible for the tax credit. They’re saying you might be eligible for retention credit, ‘give me the information for everybody that worked for you during COVID and we’ll try to get you a credit on your taxes,'” Babin said.

Once scammers have obtained personal information, the identities of all employees are at risk.

Here are some tips from the BBB on how to avoid tax credit scams:

• Don’t believe marketing materials guarantee you’ll qualify for a tax credit.
• Think twice about promises of huge refunds. Scammers use the same tactics for many different cons. Tax credit schemes are no exception.
• Don’t pay to get money. Watch out for companies or individuals that charge you fees based on high and optimistic percentages of recovered taxes.
• Know the rules about erc or other tax credits. A little research can debunk scammers’ claims before you fall victim to their schemes.
• Be careful with your personal information. Never give sensitive information to someone you don’t know and trust.

If you have a scam you’d like me to investigate, feel free to send me an email at smasters@klfy.com.