Titan Mutual Lending Inc., a California-based mortgage lender, is locked in a legal battle with the Internal Revenue Service, demanding a $5 million refund for worker tax credits it claims were wrongfully denied. The lawsuit, filed Thursday in a federal court, alleges that the IRS denied one of Titan’s claims for employee retention credits (ERC) without conducting an audit. Titan insists it deserves the refund, which pertains to employee retention tax credits under the CARES Act.
The Claim Denial and Titan’s Fight for Justice
Titan’s lawsuit centers on the IRS’s refusal to approve its amended returns for the last three quarters of 2020 and the first three quarters of 2021, which sought credits to support its workers during the COVID-19 pandemic. Despite Titan’s belief that it met all the requirements set forth by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), the IRS denied its claim without offering an explanation or conducting an audit.
The company claims that it qualified for the credits because of pandemic-era regulations that severely impacted its business operations. As a lender with substantial FHA and VA-backed loans in its portfolio, Titan was directly affected by federal moratoriums on foreclosures and evictions, which, according to Titan, disrupted its operations and business cash flow during the pandemic.
