Reg. § 31.3131-1 Recapture of credits.
(a) Recapture of erroneously refunded credits Any amount of credits for qualified sick leave wages under section , including any increase to the amount of the credits under sections , , and , that are treated as overpayments and refunded or credited to an employer under section or and to which the employer is not entitled, resulting in an erroneous refund to the employer, shall be treated as an underpayment of the taxes imposed under section and so much of the taxes imposed under section as are attributable to the rate in effect under section , as applicable, and may be assessed and collected by the Secretary in the same manner as the taxes.
(b) Advance credit amounts erroneously refunded The determination of any amount of credits erroneously refunded as described in of this section must take into account any amount of credits advanced to an employer under the process established by the Internal Revenue Service in accordance with section and .
(c) Third party payors For purposes of this section, employers against whom an erroneous refund of the credits under section (including any increases in those credits under section ) can be assessed as an underpayment of the taxes imposed under section and so much of the taxes imposed under section as are attributable to the rate in effect under section , as applicable, include persons treated as the employer under sections , , and , consistent with their liability for the section or taxes against which the credit applied, and also include those persons' common law employer clients that remain subject to all provisions of law applicable to employers with respect to the payment of wages or compensation, as applicable.
(d) Applicability date This section applies to all credit refunds under section (including any increases in those credits under section ), advanced or paid on or after September 8, 2021.
[T.D. 9978, 88 FR 48124, July 26, 2023]