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The COVID Project

The IRS

What the Service did, and when

How the IRS administered the Employee Retention Credit after the last claimable quarter closed: the moratorium, the withdrawal and voluntary disclosure programs, the letters, the closure of unexamined claims and the litigation, in date order, with the Service's own releases as the sources.

55 dated eventsMar. 31, 2020 to Sept. 4, 2026

In plain terms: this page lists what the Service (the IRS) did with the credit after September 30, 2021, the last day of the last claimable quarter. On September 14, 2023 it announced a moratorium on processing new claims. On October 19, 2023 it opened a process for withdrawing unpaid claims, and on December 21, 2023 a first voluntary disclosure program, with a second in August 2024. On June 20, 2024 it described a “risk review” of more than a million claims, sorted into bands by its own scoring. From the summer of 2024 it mailed about 28,000 Letters 105-C, which its release called “disallowance letters”; the National Taxpayer Advocate recorded that they issued “without first conducting an examination.” The claim window for the 2021 quarters closed on April 15, 2025. By December 31, 2025 the Service had closed every claim that was not under examination or before its Independent Office of Appeals. Claimants who received a letter took their claims to the courts, and the courts have begun to read the suspension test; those decisions sit on the line below as exhibits.

Each event carries its date, its source and, where the Library holds the document, the exhibit. Use the chips to narrow the line to the Service's own actions, its guidance or the litigation. What the United States has said about the test in court is collected on In the Government's Own Words; the Notice (Notice 2021-20) is read question by question on the Notice page; the statute and the orders join this line on the full timeline.

The key releases

The releases named above, with the exhibits the Library holds. Each row links to its day on the line below.

The line, in date order

Show

2020

  1. IRS news release IR-2020-62 announces the ERC and points to FAQs on IRS.gov

    IRS news release IR-2020-62 announces the ERC and points to FAQs on IRS.gov. IRS's own contemporaneous statement of the credit's purpose. IR-2020-62 announces the credit; FAQs posted on IRS.gov.

  2. IRS posts expanded ERC FAQs on IRS.gov (the FAQs later incorporated into Notice 2021-20)

    IRS posts expanded ERC FAQs on IRS.gov (the FAQs later incorporated into Notice 2021-20). Shows the 'more than nominal' / 10% standard originated in sub-regulatory FAQs, not statute or regulation. FAQ pages 'Page Last Reviewed or Updated: 29-Apr-2020' carry FAQs 28-38: FAQ 28 uses 'affects an employer's operation... including orders that limit hours of operation'; FAQ 30 is a flat 'No' for 'essential businesses'; FAQ 32 is confined to 'essential businesses' not required to close and to the 'sole reason' formulation; FAQ 33 has no partial carve-out; FAQ 34 is an unqualified 'Yes' with no nominal qualifier; every page carries the disclaimer that the FAQ 'may not be relied upon as legal authority.'

  3. FAQs 30, 33, 34 and 35 marked '(updated June 19, 2020)' in the January 15, 2021 capture: 'more than a nominal portion' added to FAQ 30

    FAQs 30, 33, 34 and 35 marked '(updated June 19, 2020)' in the January 15, 2021 capture: 'more than a nominal portion' added to FAQ 30; the 'certain purposes, but not others' paragraph and Examples 2-3 added to FAQ 33; 'more than a nominal effect' added to FAQ 34 for modifications only, with Examples 1-6; no 10 percent figure anywhere.

    GuidanceEx. LAW-136#

2021

  1. IRS issues Notice 2021-20 (IR-2021-48), 2021-11 I.R.B. 922 (published Mar. 15, 2021), guidance on the 2020 ERC, incorporating the FAQs and adopting the 'more…

    IRS issues Notice 2021-20 (IR-2021-48), 2021-11 I.R.B. 922 (published Mar. 15, 2021), guidance on the 2020 ERC, incorporating the FAQs and adopting the 'more than nominal portion' standard with a 10% deemed safe harbor. Source of the 10% test the Service's letters invoke against partial-suspension claims; the notice itself frames 10% as a deeming rule ('will be deemed'), which Tri-State (2026) treated as a method of satisfying the test, not a requirement. Notice 2021-20 released (IR-2021-48); published 2021-11 I.R.B. 922 on March 15, 2021. Changes from the FAQs: 'affects' becomes 'relate to the suspension of' (Q&A-10); the customer exclusion is extended to all employers and to any 'reduction in demand' (Q&A-13); 'more than a nominal portion' is added to the closed-purposes rule (Q&A-17) and the two 10 percent deeming rules appear for the first time (Q&A-11, Q&A-18); the four comparable-operations factors and the transition-period sentence appear (Q&A-16); the masks-and-aisles sentence appears (Q&A-18); the health-department cleaning closure is added to the list of governmental orders (Q&A-10).

    GuidanceSource#
  2. IRS issues Notice 2021-23 (2021-16 I.R.B. 1113, published Apr. 19, 2021) on the ERC for Q1-Q2 2021

    IRS issues Notice 2021-23 (2021-16 I.R.B. 1113, published Apr. 19, 2021) on the ERC for Q1-Q2 2021. Amplifies Notice 2021-20 for 2021 quarters; the same partial-suspension framework carried forward. Notice 2021-23 released; published 2021-16 I.R.B. 1113 on April 19, 2021.

  3. IRS issues Notice 2021-49 (2021-34 I.R.B., published Aug. 23, 2021) on the ERC for Q3-Q4 2021 and miscellaneous issues for 2020-2021

    IRS issues Notice 2021-49 (2021-34 I.R.B., published Aug. 23, 2021) on the ERC for Q3-Q4 2021 and miscellaneous issues for 2020-2021. Completes the IRS guidance set; confirms the IRS itself considered the credit broadly available through 2021. Notice 2021-49 released (IR-2021-165); published 2021-34 I.R.B. 316 on August 23, 2021; Rev. Proc. 2021-33 released August 10, 2021 and published at 2021-34 I.R.B. 327.

  4. IRS issues Rev. Proc. 2021-33 (2021-34 I.R.B.), safe harbor excluding PPP forgiveness, SVOG and RRF grants from gross receipts for ERC eligibility

    IRS issues Rev. Proc. 2021-33 (2021-34 I.R.B.), safe harbor excluding PPP forgiveness, SVOG and RRF grants from gross receipts for ERC eligibility. IRS acted to make it easier, not harder, to qualify under the gross-receipts test.

    GuidanceSource#
  5. Notice 2021-65 released (IR-2021-242); published 2021-51 I.R.B. 880 on December 20, 2021

    Notice 2021-65 released (IR-2021-242); published 2021-51 I.R.B. 880 on December 20, 2021.

    GuidanceEx. LAW-104#

2023

  1. AM 2023-005 (supply chain) signed; released July 21, 2023

    AM 2023-005 (supply chain) signed; released July 21, 2023.

    GuidanceEx. LAW-106#
  2. FAQ page: 'Qualifying government orders' Q1 and Q3 added

    FAQ page: 'Qualifying government orders' Q1 and Q3 added.

    GuidanceEx. LAW-120#
  3. IR-2023-169: IRS announces immediate moratorium on processing new ERC claims through at least Dec. 31, 2023

    IR-2023-169: IRS announces immediate moratorium on processing new ERC claims through at least Dec. 31, 2023; existing claims to take 180 days or longer. Stated rationale was promoter abuse and protecting 'honest' businesses -- not a finding that the credit itself was illegitimate; IRS admits processing of legitimate claims would slow. IR-2023-169: processing moratorium on new claims through at least December 31, 2023; FAQ Q5 ('more than nominal' is 'at least 10%') added the same day.

  4. AM 2023-007 (OSHA communications) signed; released November 3, 2023

    AM 2023-007 (OSHA communications) signed; released November 3, 2023.

    GuidanceEx. LAW-143#
  5. IR-2023-193: IRS announces ERC claim withdrawal process for unpaid claims

    IR-2023-193: IRS announces ERC claim withdrawal process for unpaid claims. IRS framed the program as relief for those 'pressured or misled' by promoters, implicitly distinguishing them from legitimate claimants. IR-2023-193: claim-withdrawal process.

  6. IR-2023-230: more than 20,000 Letters 105C to entities that did not exist or paid no wages

    IR-2023-230: more than 20,000 Letters 105C to entities that did not exist or paid no wages.

    IRS actionsEx. LAW-112#
  7. IR-2023-247: IRS launches first ERC Voluntary Disclosure Program (repay 80%, apply by Mar. 22, 2024)

    IR-2023-247: IRS launches first ERC Voluntary Disclosure Program (repay 80%, apply by Mar. 22, 2024); 20,000 Letters 105-C sent in December 2023. Program was aimed at employers who 'shouldn't have applied'; the 80% figure reflects promoter fees, again attributing abuse to promoters. IR-2023-247 and Announcement 2024-3: first Voluntary Disclosure Program, 80 percent repayment, through March 22, 2024.

2024

  1. IRS readout of Commissioner Werfel's briefing to the Senate Finance Committee on ERC

    IRS readout of Commissioner Werfel's briefing to the Senate Finance Committee on ERC. IRS statement that its goal remained processing legitimate claims while stopping promoter-driven ones.

    IRS actionsSource#
  2. IRS mails approximately 28,000 Letters 105-C/106-C on claims it scored 'high risk' (summer 2024), estimated to prevent up to $5 billion in payments

    IRS mails approximately 28,000 Letters 105-C/106-C on claims it scored 'high risk' (summer 2024), estimated to prevent up to $5 billion in payments. The volume of those letters opened the two-year period of sec. 6532(a) to file suit, running into 2026.

    IRS actionsSource#
  3. IR-2024-169: IRS announces results of its review of 1 million+ pre-moratorium claims; moratorium continues for claims filed after Sept. 14, 2023

    IR-2024-169: IRS announces results of its review of 1 million+ pre-moratorium claims; moratorium continues for claims filed after Sept. 14, 2023; inventory 1.4 million. The IRS's own analysis placed a tier of claims at 'low risk' and acknowledged that some claims were 'truly eligible'; the 60-70% group showing an 'unacceptable level of risk' was explicitly defined as needing 'additional analysis,' not as ineligible. IR-2024-169: review of more than 1 million claims; 10-20 percent in the 'highest-risk group', 60-70 percent 'unacceptable level of risk' needing 'additional analysis,' 10-20 percent 'low risk'; moratorium continued; inventory 1.4 million.

    IR-2024-169: risk review of more than 1 million claims; 10-20 percent highest risk, 60-70 percent 'unacceptable level of risk' needing 'additional analysis,' 10-20 percent low risk; moratorium continued; inventory 1.4 million.

  4. IR-2024-203: IRS lifts moratorium in part, begins processing claims filed Sept. 14, 2023-Jan. 31, 2024

    IR-2024-203: IRS lifts moratorium in part, begins processing claims filed Sept. 14, 2023-Jan. 31, 2024; moves 50,000 claims it identified as valid to payment starting September 2024; acknowledges some of the letters omitted the appeal-rights paragraph. IRS admission of error in the mailings and commitment to correct the letters issued in error; confirmation that 'low-risk' claims would be paid. IR-2024-203: 28,000 'disallowance letters' issued to claims that 'showed a high risk of being incorrect'; 'more than 90%' said to be validly issued; appeal-rights paragraph omitted from some; processing of claims filed September 14, 2023 to January 31, 2024 begins; NTA blog of August 21, 2024 records that the letters issued 'without first conducting an examination'.

  5. IR-2024-212: IRS reopens ERC Voluntary Disclosure Program (repay 85%, 2021 periods only, through Nov. 22, 2024) and announces up to 30,000 recapture letters

    IR-2024-212: IRS reopens ERC Voluntary Disclosure Program (repay 85%, 2021 periods only, through Nov. 22, 2024) and announces up to 30,000 recapture letters. IRS again acknowledges 'well-meaning businesses' caught up in promoter activity. IR-2024-212 and Announcement 2024-30: second VDP (85 percent; 2021 periods; through November 22, 2024); up to 30,000 recapture letters.

  6. Senators Warner and Kaine press IRS for faster review of ERC claims

    Senators Warner and Kaine press IRS for faster review of ERC claims. Congressional statement of the credit's purpose and of harm from delay to legitimate claimants.

    IRS actionsSource#
  7. National Taxpayer Advocate blog on the ~28,000 Letters 105-C, noting the IRS acknowledged omissions and intended corrective letters

    National Taxpayer Advocate blog on the ~28,000 Letters 105-C, noting the IRS acknowledged omissions and intended corrective letters. Independent (statutory) confirmation that the IRS acknowledged the omissions in those letters.

    IRS actionsSource#
  8. IR-2024-263: IRS reports ~400,000 claims (~$10 billion) in processing; checks being mailed for eligible claims

    IR-2024-263: IRS reports ~400,000 claims (~$10 billion) in processing; checks being mailed for eligible claims. IRS statement of the 'vital importance' of ERC payments to small businesses. IR-2024-263: about 400,000 claims in processing; the Service's last public processing update until June 2026 per GAO.

2025

  1. Miller & Chevalier reports 'over two dozen' ERC refund suits filed nationwide; ~1.2 million claims unprocessed as of Oct. 26, 2024

    Miller & Chevalier reports 'over two dozen' ERC refund suits filed nationwide; ~1.2 million claims unprocessed as of Oct. 26, 2024. Baseline data point for litigation volume before the 2026 surge.

    LitigationSource#
  2. Claim window for 2021 quarters closes (Form 941-X instructions; NTA blog)

    Claim window for 2021 quarters closes (Form 941-X instructions; NTA blog).

    IRS actionsEx. LAW-125#
  3. NTA blog 'The ERC Claim Period Has Closed' (updated Dec. 3, 2025): 597,000+ unprocessed claims; 84,000 returns received a Letter 105-C or 106-C

    NTA blog 'The ERC Claim Period Has Closed' (updated Dec. 3, 2025): 597,000+ unprocessed claims; 84,000 returns received a Letter 105-C or 106-C; recommends IRS finish processing by Dec. 31, 2025 and provide clear legal and factual explanations in those letters. Statutory advocate's critique of letters that do not state their grounds and of prolonged limbo for legitimate claimants.

    IRS actionsSource#
  4. Stenson Tamaddon, LLC v. IRS, No. CV-24-01123-PHX-SPL (D. Ariz.), 2025 WL 1725942: summary judgment for the government

    Stenson Tamaddon, LLC v. IRS, No. CV-24-01123-PHX-SPL (D. Ariz.), 2025 WL 1725942: summary judgment for the government; Notice 2021-20 held an interpretive rule not requiring notice and comment; 10% test characterized as a safe harbor with facts-and-circumstances discretion. Even the government's win characterizes the 10% figure as a safe harbor, not a mandatory element -- relied on by Tri-State (2026). Decision date given as June 20, 2025 in the Tri-State order's citation and CourtListener termination date; some commentary dates it June 18 or 23, 2025. Notice 2021-20 is an interpretive rule without force of law (at 22, 27); ten-percent provision is a safe harbor 'subject to rebuttal' under facts and circumstances (at 15-17, 26); refund suit is the remedy (at 20); 'no identifiable factual evidence' behind the Notice (at 25); 'close call' (at 27). Cross-motions for summary judgment on APA Counts I-III; judgment for the United States

    Litigation#
  5. Pub. L. 119-21 (H.R. 1, 'One Big Beautiful Bill Act') enacted

    Pub. L. 119-21 (H.R. 1, 'One Big Beautiful Bill Act') enacted; sec. 70605 bars allowance of any sec. 3134 (Q3/Q4 2021) credit or refund after enactment unless the claim was filed on or before Jan. 31, 2024, extends the assessment period to 6 years, and adds promoter penalties. Retroactive cutoff applies only to sec. 3134 (Q3-Q4 2021) claims; 2020 and Q1-Q2 2021 (sec. 2301) claims are not affected by 70605(d). Pub. L. 119-21 section 70605 enacted; FS-2025-07 of October 22, 2025 explains section 70605(d). Pub. L. 119-21, title VII, sec. 70605, 139 Stat. 72, 286-289 (July 4, 2025) (Enforcement provisions with respect to COVID-related employee retention credits). Barred any credit or refund under sec. 3134 for a claim filed after January 31, 2024, extended the assessment period to six years and extended the sec. 6676 penalty to employment-tax refund claims. Sec. 70605 begins at 139 Stat. 286; subsec. (d) (no credit under section 3134 allowed and no refund made after enactment unless the claim was filed on or before January 31, 2024) at 287-288; subsec. (e) (six-year assessment period under sec. 3134(l)) at 288; subsec. (f) (sec. 6676(a) amended by striking 'income tax' and inserting 'income or employment tax') at 288; subsec. (g) effective dates at 288-289; table of contents at 139 Stat. 77.

  6. The plaintiff in Stenson Tamaddon, LLC v. IRS appeals the Notice 2021-20 ruling to the Ninth Circuit, No. 25-4217 (docketed July 8-9, 2025)

    The plaintiff in Stenson Tamaddon, LLC v. IRS appeals the Notice 2021-20 ruling to the Ninth Circuit, No. 25-4217 (docketed July 8-9, 2025). Opening brief filed Sept. 17, 2025; government motion to stay proceedings filed Oct. 7, 2025. Validity of Notice 2021-20 under the APA remains unresolved on appeal.

    Litigation#
  7. In re JSmith Civil, LLC (JSmith Civil, LLC v. United States) (Bankr. E.D.N.C. Aug. 7, 2025)

    The ERC is a 'presumption-out' statute (at 5); Executive Order 121 'did not require suspension of Plaintiff's operations as a construction company' as a matter of law (at 10-11); the company's growth in receipts and hiring contradicted the claimed one-third suspension (at 11 n.6). Summary judgment for the United States (North Carolina Executive Order 121; construction company)

    LitigationEx. LAW-076#
  8. IR-2025-106 / Fact Sheet FS-2025-07 (updated Oct. 30, 2025)

    IR-2025-106 / Fact Sheet FS-2025-07 (updated Oct. 30, 2025): IRS FAQs on the OBBBA ERC compliance provisions (sec. 70605(d) limitation, timely-filing rule, appeal rights). IRS confirms 70605(d) applies only to Q3/Q4 2021 claims filed after Jan. 31, 2024, recognizes postmark rule, and preserves Appeals/refund-suit rights.

    GuidanceSource#
  9. IRS reports (to GAO and press, Feb. 2026) that it closed all non-examined ERC claims by Dec. 31, 2025

    IRS reports (to GAO and press, Feb. 2026) that it closed all non-examined ERC claims by Dec. 31, 2025; approximately 41,000 claims remain in examination or Appeals. Marks the shift from processing to exam/Appeals/litigation as the only remaining path for unpaid claims. IRS closes all remaining claims other than those in examination or Appeals, per IRS officials to GAO; about 41,000 claims remain in examination or Appeals (GAO-26-107456 at 27, 30, 49). No IRS release announces the closure.

2026

  1. Plastic Film, LLC v. United States (S.D. Miss. Jan. 20, 2026)

    'Although the Complaint does not identify a specific governmental order, there is no statutory, regulatory, or binding precedent requiring such specificity at the pleading stage. Whether the referenced orders ultimately substantiate Plaintiff's eligibility for the credit presents a fact-intensive issue appropriately addressed through discovery or at summary judgment.' (ECF 18 at 8) ECF 18: motion to dismiss granted in part (APA counts); the Q3 2020 refund claim survives; ECF 45: plaintiff's motion for judgment on the pleadings against the United States' erroneous-refund counterclaim not granted, without prejudice; leave to amend the counterclaim

  2. Gravenstein 116, LLC v. United States (Fed. Cl. Jan. 30, 2026)

    Section 280E's anti-trafficking bar 'squarely applies to the Employee Retention Credit, including the refundable portion of the credit' (at 2). Dismissal under I.R.C. 280E

    LitigationEx. LAW-075#
  3. GAO report GAO-26-107456, 'COVID-19 Relief: IRS Can Use Lessons Learned to Address and Prevent Improper Payments in Future Tax Programs.'

    GAO report GAO-26-107456, 'COVID-19 Relief: IRS Can Use Lessons Learned to Address and Prevent Improper Payments in Future Tax Programs.' Authoritative totals: nearly 5 million claims processed, ~$283 billion paid; GAO describes the credit's purpose neutrally; notes IRS never produced a required improper-payment estimate. GAO-26-107456 published.

  4. TAS FY2026 Objectives Report, Objective 6 (updated Aug. 4, 2026)

    TAS FY2026 Objectives Report, Objective 6 (updated Aug. 4, 2026): IRS revises target to complete initial review of all ERC claims by Dec. 31, 2026. Shows IRS's own timetable for resolving remaining claims slipped a full year.

    IRS actionsSource#
  5. JPM Restaurant, LLC v. United States (E.D. Tenn. Feb. 27, 2026)

    As recited in NEHS at 17, Sundancer at 5-6, Tapestry at 10 and Region IV at 9: 'due to' requires 'both factual and proximate causation--meaning that the order must have been the but-for cause and a foreseeable cause of the full or partial shutdown'; labor-shortage causal chain 'too attenuated'. Summary judgment; on appeal

    LitigationEx. LAW-086#
  6. Bloomberg Tax reports expected surge of ERC refund suits as the two-year sec. 6532 deadlines from the summer-2024 letters approach

    Bloomberg Tax reports expected surge of ERC refund suits as the two-year sec. 6532 deadlines from the summer-2024 letters approach; Appeals lost over a quarter of its workforce; NTA urges IRS to sign Form 907 extensions. Documents Appeals bottleneck forcing taxpayers into court.

    LitigationSource#
  7. Ninth Circuit, ERC Today, LLC v. McInelly, No. 25-2642 (D. Ariz. No. 2:24-cv-03178-SMM), argued and submitted Mar. 4, 2026 (Phoenix)

    Ninth Circuit, ERC Today, LLC v. McInelly, No. 25-2642 (D. Ariz. No. 2:24-cv-03178-SMM), argued and submitted Mar. 4, 2026 (Phoenix); unpublished memorandum affirms the district court's refusal of a preliminary injunction against the IRS 'Disallowance During Processing' program for lack of Article III standing; remanded with note that plaintiffs could seek leave to amend. This is a different Ninth Circuit appeal from No. 25-4217 (Notice 2021-20 APA challenge); a separate matter. Panel: Hawkins, Bybee, Friedland. Appellants (ERC Today and [the plaintiff]) 'offer no evidence that they are making less money' as a result of the program; loss-of-process theory not accepted (mem. at 2-4). Affirmance of the refusal of a preliminary injunction against the 'Disallowance During Processing' program for want of Article III standing

  8. Juggler Dave and Friends, LLC v. United States (Fed. Cl. Mar. 25, 2026)

    Retroactive Jan. 31, 2024 filing bar for section 3134 credits satisfies due process; Q1-Q2 2021 credits had been paid (at 1-2, 9). Motion to dismiss the Q3 2021 claim granted under Pub. L. 119-21 sec. 70605(d)

    LitigationEx. LAW-029#
  9. NTA blog (updated May 1, 2026): IRS adopts streamlined process (Notice CP320B / Form 907) to extend the two-year period to file suit on ERC claims…

    NTA blog (updated May 1, 2026): IRS adopts streamlined process (Notice CP320B / Form 907) to extend the two-year period to file suit on ERC claims awaiting Appeals; Appeals resolution averaged 337 days. IRS acknowledgment that administrative delay alone could extinguish valid refund claims. Notice CP320B / Form 907 streamlined extension process (NTA blog; IRS CP320B page); Letter 105-C and 106-C pages updated the same day.

  10. Northeast Health Services, LLC v. United States, No. 24-2096T (Fed. Cl.): summary judgment for the government

    Northeast Health Services, LLC v. United States, No. 24-2096T (Fed. Cl.): summary judgment for the government; Massachusetts mental-health provider exempted from cited orders; court requires proximate (not but-for) causation for 'due to' a governmental order. Contrary authority on causation decided the same day as Tri-State. DPH guidance promulgated under compulsory authority qualifies as an 'order' (at 12 & n.21); 'due to' requires that a qualifying order be 'both the factual and proximate cause of a full or partial suspension' (at 13-17; *11); a but-for reading 'would broaden the suspension-of-business prong such that employers could virtually always rely on it' (at 17); the parties' factual disputes on suspension were reasonable (n.24). Cross-motions; United States' dispositive cross-motion granted (Massachusetts Order Nos. 13 and 33; DPH guidance)

  11. Tri-State Memorial Hospital v. United States, No. 2:25-CV-0181-TOR (E.D. Wash.) (Rice, J.), ECF No. 38, order on the United States' motion to dismiss

    Tri-State Memorial Hospital v. United States, No. 2:25-CV-0181-TOR (E.D. Wash.) (Rice, J.), ECF No. 38, order on the United States' motion to dismiss: hospital's $11.5 million ERC refund claim for Q1-Q3 2021 survives; court applies Loper Bright/Skidmore, adopts plain-meaning definition of 'partial suspension,' refuses the Government's 'significant' gloss, and holds Notice 2021-20's 10% test is a method of satisfying the more-than-nominal standard, not a requirement. Leading taxpayer-favorable district court ruling on partial suspension; directly refuses the IRS litigating position that 'more than nominal' means 'significant' and that the 10% threshold is mandatory; holds 'due to' requires but-for causation. Partial suspension = temporary delay, interruption or termination of a portion of the business (at 9-10); 'more than nominal' is not 'significant' (at 10-11); title does not narrow suspension to closure (at 12); 10 percent is 'a method for the test to be met not as a requirement' (at 16); 'due to' = 'because of' = but-for (at 17-19); COVID-versus-orders argument fails (at 20-21). Motion to dismiss refused (Q1-Q3 2021 refund suit; Washington Proclamation 20-24.2)

    LitigationSource#
  12. Accounting Today reports ERC disputes moving to court; IRS official said ~41,000 cases under exam or appeal as of January 2026

    Accounting Today reports ERC disputes moving to court; IRS official said ~41,000 cases under exam or appeal as of January 2026; practitioners report IRS paying few remaining claims and issuing 'pattern' Letters 105C. Practitioner evidence of boilerplate letters.

    LitigationSource#
  13. IRS posts the monthly ERC inventory page (GAO Recommendation 3 closed)

    IRS posts the monthly ERC inventory page (GAO Recommendation 3 closed).

    IRS actionsEx. LAW-118#
  14. First Source Employee Management, Inc. v. United States, No. 1:24-cv-02209-CEF (N.D. Ohio)

    First Source Employee Management, Inc. v. United States, No. 1:24-cv-02209-CEF (N.D. Ohio): APA counts seeking to enjoin/vacate Notice 2021-20 dismissed for lack of standing/jurisdiction; $20.2 million refund count under sec. 7422 proceeds. Court reasons that ERC entitlement flows from the CARES Act, not the Notice -- useful for arguing the Notice cannot narrow the statute. The refund action under 26 U.S.C. 7422 'provides complete relief' (at 8); an injunction or vacatur of Notice 2021-20 would not redress the PEO's injury (redressability at 9-12; conclusion at 15) -- i.e., (at 8, 10, 15). Counts two through four (APA) dismissed; refund count proceeds

  15. Plastic Film, LLC v. United States, No. 5:25-cv-30-DCB-LGI (S.D. Miss.)

    Plastic Film, LLC v. United States, No. 5:25-cv-30-DCB-LGI (S.D. Miss.): the United States is permitted to recover allegedly erroneous ERC refunds by civil suit under 26 U.S.C. sec. 7405, not limited to sec. 6205 administrative procedures. Shows government is also litigating offensively to claw back paid ERC refunds.

    LitigationSource#
  16. Sundancer Pools, Inc. v. United States (Fed. Cl. June 23, 2026)

    Judgment on the pleadings deferred; leave to amend (California and San Diego County orders; Q2-Q3 2021)

    LitigationEx. LAW-028#
  17. Tapestry Senior Housing Management, LLC v. United States (D. Minn. June 25, 2026)

    The complaint 'vaguely gestures toward governmental orders from Ohio and Pennsylvania. But it does not identify them with any specificity' (at 10); if the orders are not named they 'must [be] describe[d]... with more specificity' (at 11); follows JPM Restaurant's factual-and-proximate-cause formulation (at 10). Complaint dismissed without prejudice under Rule 12(b)(6)

    LitigationEx. LAW-031#
  18. Key Meetings, Inc. v. United States, No. 25-cv-06520-WHO (N.D. Cal.) (Orrick, J.)

    Key Meetings, Inc. v. United States, No. 25-cv-06520-WHO (N.D. Cal.) (Orrick, J.): Fifth Amendment challenge to sec. 70605(d)'s retroactive Jan. 31, 2024 cutoff fails; Q3 2021 claim dismissed. Juggler Dave & Friends, LLC v. United States, 181 Fed. Cl. 52 (2026) (Hertling, J.) reaches same result. Retroactive cutoff for late-filed Q3/Q4 2021 claims has so far survived constitutional challenge. Sec. 70605(d) is constitutional as applied; the United States moved only against the section 3134 quarter (at 1-4, 9). Motion to dismiss Count Three (Q3 2021) granted under sec. 70605(d); Q1-Q2 2021 counts proceed

  19. Region IV Mental Health Services v. United States (N.D. Miss. July 1, 2026)

    Refuses the United States' JPM-based argument that a plaintiff 'must plead specific government orders were the but for cause of the business suspension for each specific tax quarter'; 'Region IV is not required to plead with specificity the government orders that caused its alleged suspensions at this stage' (at 9-10); a complaint identifying 'at least 55 alleged government orders' is not a shotgun pleading (at 9). Motion to dismiss granted only as to the declaratory-judgment request on the Q2 2021 recapture; the Rule 12(b)(6) motion fails

    LitigationEx. LAW-081#
  20. South Delta Planning & Development District v. United States (N.D. Miss. July 15, 2026)

    'As to the United States' claim that, to sufficiently plead an ERC refund claim, the complaint must pinpoint a specific order that proximately caused the alleged partial shutdown, that claim was recently rejected by the Southern District of Mississippi.' (at 7, following Plastic Film and Region IV) Rule 12(b)(1) motion granted in part only; Rule 12(b)(6) motion fails; stay lifted

    LitigationEx. LAW-082#
  21. I Health and Life Insurance Services v. United States (Fed. Cl. July 23, 2026)

    The California orders are governmental orders (at 2-3); plaintiff must allege that a qualifying order 'factually and proximately caused it to temporarily cease performing a distinct portion of its business' (at 17, quoting Sundancer); occupancy caps and worker-exclusion rules adequately pleaded as orders but the cessation of a discrete portion was not (at 14, 17). Ruling on RCFC 12(c) motion deferred pending amendment (California EOs N-25-20, N-33-20, N-60-20; county orders; Q3 2020 and later)

    LitigationEx. LAW-025#
  22. IRS ERC webpage status update (week ending Aug. 29, 2026): ~14,900 ERC claims remain, broken down by stage

    IRS ERC webpage status update (week ending Aug. 29, 2026): ~14,900 ERC claims remain, broken down by stage; IRS states it updates the page monthly. Most current official inventory figure; shows remaining claims are overwhelmingly in audit, letter-response or Appeals posture. Inventory as of the week ending August 29, 2026: about 14,900 claims (under review 1,650; 'pending payment or disallowance' 2,950; under audit 3,600; 'awaiting review of disallowance responses' 5,300; Appeals 1,400); page last reviewed September 8, 2026; read live September 27, 2026.

  23. County of Barry (dba Thornapple Manor) v. United States (W.D. Mich. Sept. 4, 2026)

    United States' statements: 'The statute does not define order, partial suspension, or the causation requirement. The parties in this case disagree about all three of these parts of the ERC.' (at 3); the case 'is one of four ERC cases being litigated by the same counsel'; cross-motions for summary judgment pending in Marquette County Medical Care Facility v. United States, No. 2:25-cv-135 (W.D. Mich.) (at 4); JSmith Civil appeal pending, No. 5:25-cv-513 (E.D.N.C.) (at 2). United States' motion to stay pending the Sixth Circuit's decision in JPM

    LitigationEx. LAW-085#

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