On July 21st, the Office of Chief Counsel at the IRS issued a memorandum to address noncompliance with ERTCs. The memorandum provides responses to various scenarios that employers have been trying to make to qualify as “eligible employers”. Companies have been trying to take advantage of supply chain disruptions during the pandemic to receive tax credits, even though they might not be eligible to receive tax credits. This problem has been placing auditors in uncomfortable situations, as auditors now need to consider NOCLAR with ERTCs as well as revenue recognition issues.