Earlier this year, the Emporia Recreation Commission voted to pay back employee retention tax credits to the federal government after learning they had not qualified for said credits. Well, that doesn’t appear to be the end of this saga, as the ERC has now filed a lawsuit against the agency that advised the action.
Earlier this year, the ERC voted unanimously to return over $700,000 in employee tax credits that were applied for during the COVID-19 pandemic at the advice of Wright CPA. It was later discovered that, as a quasi-government entity, the commission did not qualify for the funds.
The ERC received two allocations totaling $700,000 between 2020 and 2021 and never spent the money. Although the money was returned in full, the ERC was notified that they may face some form of penalty or repayment of interest in the future.
In the event the ERC does have to repay funds to the IRS, ERC representatives feel it should not come at the expense of taxpayer dollars and should instead be resolved through the company that advised the application, Wright CPA. In simple terms, the 140-page lawsuit alleges the commission followed the professional and ethical guidance of their financial consultant and therefore should not be held at fault for the situation that developed.
According to the petition, which can be found on the Kansas Judicial Branch Case search website casesearch.kscourts.gov.
