Lawmakers have been debating clawing back some unused pandemic relief funds as part of the debt limit and budget negotiations, but the tax credit does not appear to be part of those discussions. Senator Kirsten Gillibrand, Democrat of New York, sent the I.R.S. a letter this month urging it to clear its backlog and issue refunds faster.
More applications for tax credits are coming in every day as firms continue to blitz social media sites and TV and radio stations with ads touting the ease of getting federal money. In some cases, the firms are cold-calling potential customers.
Since last October, there have been about 9,000 advertisements promoting application services for employee retention tax credits airing on national cable and broadcast television networks, according to the ad tracking firm Vivvix/CMAG.
About three-quarters of those were sponsored by one of the biggest players in the industry, Innovation Refunds, which advertises on networks such as CNBC and claims that it takes just eight minutes for the firm to determine if an applicant is eligible. The firm says it has helped businesses claim over $1 billion in payroll tax refunds.
“That easy,” a narrator says in one of the ads. “But it’s only available for a limited time.”
Innovation Refunds, which takes a 25 percent cut of whatever refund a customer receives from the I.R.S., uses a network of tax attorneys to review the applications and process the forms. It received financing from the investment firm Raistone to expand its ability to advertise and process more amended tax returns.