Internal Revenue Service — pandemic tax enforcement reports and announcements

Case summary

This page collects nine Internal Revenue Service documents on pandemic relief and tax enforcement. Six are IRS Criminal Investigation annual reports for fiscal years 2020 through 2025. The other three are guidance: Announcement 2020-12, which tells lenders not to file information returns or furnish payee statements under section 6050P to report qualifying forgiveness of Paycheck Protection Program covered loans; Revenue Procedure 2021-49 on allocations of PPP tax exempt income for partnerships; and Announcement 2024-3, which establishes a Voluntary Disclosure Program for employers to resolve erroneous claims for credit or refund involving the Employee Retention Credit. The annual reports describe IRS-CI investigations, including COVID-19 fraud cases and the amounts of financial fraud identified each year.

Case at a glance

What does the 2020 announcement say?

That lenders should not file information returns or furnish payee statements under section 6050P of the Internal Revenue Code to report the amount of qualifying forgiveness on covered loans made under the PPP, which section 1102 of the CARES Act established under section 7(a)(36) of the Small Business Act, 15 U.S.C. § 636(a)(36).

What is the Employee Retention Credit program in Announcement 2024-3?

A voluntary disclosure program for employers to resolve erroneous claims for credit or refund involving the ERC. The announcement states that the IRS has concerns about scams and potential fraud regarding ERC claims and that those who erroneously received the credit face enforcement action and are subject to assessment and collection procedures.

What do the criminal investigation reports say about pandemic fraud?

The fiscal year 2025 report states that IRS-CI identified over $10.6 billion in financial fraud including tax and non-tax offenses that year, and that Shafii Farah was sentenced to 28 years in prison in a COVID-19 fraud scheme involving over $250 million, with 73 defendants indicted so far in that scheme.