Titan’s Efforts to Resolve the Dispute
In response to the IRS’s rejection, Titan sought a review of the decision through the IRS’s Independent Office of Appeals. However, nearly a year has passed without any resolution or explanation from the IRS regarding the denial. Titan now hopes to recover the $5 million it believes it is entitled to, based on claims for the ERCs, which were designed to help businesses retain workers during the crisis.
The IRS Under Fire for Its Handling of ERC Claims
Titan’s lawsuit highlights a broader issue that has plagued thousands of businesses across the nation. The IRS has faced mounting criticism for its processing of ERC claims, with many businesses arguing that they were wrongfully denied without proper examination. Titan’s case is just one of many similar lawsuits against the IRS.
Other businesses, like Stenson Tamaddon LLC and ERC Today LLC, have filed lawsuits claiming that the IRS has been arbitrarily rejecting claims and disallowing taxpayer benefits without sufficient justification. In one particularly alarming incident, a photo circulated showing stacks of IRS disallowance letters sent to a tax preparation firm, all bearing identical language: “We can’t allow your claim.”
The IRS has defended its actions, stating that it has been sorting claims based on perceived risk, a practice it says is in line with its regulations. Despite this, the National Taxpayer Advocate has flagged the delays and lack of transparency in the IRS’s handling of ERC claims as a significant issue, with many businesses still waiting for refunds that could help them recover from pandemic-era losses.
