The Internal Revenue Service is cracking down on fraudulent Employee Retention Tax Credit claims and will not process any new claims from businesses through at least the end of the year.

Congress created the Employee Retention Credit (ERC) in March 2020 by way of the $2.2 trillion coronavirus stimulus package known as the Cares Act. The credit sought to motivate employers to keep workers on staff during the pandemic as unemployment rates ballooned.

Fast forward more than three years later and the IRS has been flooded with about 3.6 million ERC claims, many of which the agency says were initiated by bad actors.

“The IRS is increasingly alarmed about honest small-business owners being scammed by unscrupulous actors, and we could no longer tolerate growing evidence of questionable claims pouring in,” IRS Commissioner Danny Werfel said in a Thursday statement. “The further we get from the pandemic, the further we see the good intentions of this important program abused.”

Bad actors are contributing to the backlog of ERC claims, which prevents small businesses that actually deserve the credit from receiving their claim in a timely fashion, Werfel added. It could take 90 to 180 days for a business to receive their ERC refund, or even longer if a claim gets audited.

So-called ERC mills and other bad actors are to blame. These entities, which aren’t all unscrupulous, have popped up in the past year, reaching out to business owners to offer their services in helping entrepreneurs obtain an ERC payout. The catch? The firms helping small businesses charge a percentage of the total refund, upwards of 25 percent, and oftentimes target businesses that don’t even qualify for the credit to begin with.

The high fees outlets charge, while unsavory, isn’t the issue here. It’s the fact that they’re going after businesses that may not qualify for the credit. If the IRS determines a company doesn’t qualify for a refund, that business is on the hook to pay back the credit, plus potential fines.