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ARTICLE · 07 MAY 2026

Streamlined Extension Process Now Available For Employers Facing ERC Claim Disallowance Deadlines

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The IRS has introduced a streamlined process allowing employers with disallowed COVID-era Employee Retention Credit claims to request additional time for administrative appeals before their statutory deadline to file suit expires. Employers with six months or less remaining may now submit Form 907 through a new online tool to preserve their refund rights while claims remain under review.

United StatesTax
Caroline Lafourcade
Caroline Lafourcade
Leon H. Rittenberg III
Leon H. Rittenberg III
Kevin Naccari, Jr.
Kevin Naccari, Jr.
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On April 27th, the IRS announced a method for certain taxpayers to request additional time to pursue an administrative appeal when the IRS has disallowed its COVID-era Employee Retention Credit (ERC) claim before they must file suit. (IR-2026-58).

When the IRS disallows an ERC claim, it issues Letter 105‑C or 106‑C, triggering a two‑year period for the taxpayer to either resolve the issue administratively or file a refund suit in federal court. However, filing an appeal of the disallowance with the IRS Independent Office of Appeals does not suspend or extend this statutory deadline.

Employers that have six months or less remaining to file suit, and whose ERC claims remain under IRS review, may now submit a Form 907, “Agreement to Extend the Time to Bring Suit,” through the IRS’s new online tool at IRS.gov/DUTReply by selecting notice CP320B from the drop-down menu. The process allows taxpayers to avoid losing refund rights while their ERC claims remain under review. The IRS will

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