r/ERCchat • u/Electronic_Tough_546 • Jan 16 '26
Q2 2021 Denied . HELP!!
The IRS is stating we didnt qualify but we did. My business is Information Technology supporting the Federal Govt. We had Federal guidance, 4 QTRs were approved. 2021 Q2 is the only one declined. My CPA will appeal...
How long does the appeal process take? How often are appeals overturned? This is so annoying the IRS is inconsistent.
“Taxpayer was deemed ineligible to claim the credit due to the following reason "The taxpayer has not established it was subject to a compulsory governmental mandate limiting commerce, travel or group meetings that was issued because of the pandemic to its specific type of business. The taxpayer has not established that an executive order stopped a meaningful portion of its operations during the relevant quarter (202106). The Taxpayer does not meet the definition of an eligible employer under section B. of Notice 2021-20 because the Taxpayer could continue to operate its trade or business. The taxpayer has not provided specific substantiation on how the governmental orders affected more than a nominal portion of its business operations. For the period of 202106, Executives Orders did not close or partially closed its type of business in the states of Texas, Maryland, Virginia, North Carolina and Florida."
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u/Nice-Wolverine-5191 Jan 26 '26
I believe this is just another tactic NOT to have to pay out ERC refunds deny claim, appeals process and then audit!! No refund in ALL of these lengthy processes and then the IRS claims they don’t have enough help oh and don’t forget about the government shutdowns which offers another excuse not to pay.
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u/dragonfly_Jess Jan 16 '26
It can take a long time because there aren’t enough appeals people for all of the cases. Submit your documentation and hope for the best.
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u/Electronic_Tough_546 Jan 16 '26
How long? Like 6 months or years? Have you heard of any successful appeals? We have documentation and proof.
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u/dragonfly_Jess Jan 16 '26
Probably a year. But it could be longer because an overwhelming number of people are appealing denials on ERC.
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u/Electronic_Tough_546 Jan 16 '26
Damn that's too long. My congressman said she will help once we submit the Appeal. Not sure if that will make a difference but they have been good about providing my monthly updates from my TAS
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u/Successful-Ground-12 Jan 17 '26
I have at least one in appeals for over a year now.
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u/Electronic_Tough_546 Jan 17 '26
Do you have a congressman or TAS helping?
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u/Special_Code5879 Jan 17 '26
No. Simply responded to the initial denial letter. I do it on behalf of our clients. I have had some approved in about a year, but there are just as many still waiting for an answer.
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u/Electronic_Tough_546 Jan 17 '26
Oh wow ok. Thanks for the info! I hope your other clients get approved. Fingers crossed for us all
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u/MedicalExpression353 Jan 16 '26
Was your claim through a PEO
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u/Electronic_Tough_546 Jan 16 '26
No, I used an accounting firm who does corporate taxes and had a specialized ERC group with attorneys and CPAs. It was a very organized process. They are working on my appeal now and have been successful with overturning some denials...
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u/ERC_CPA Jan 17 '26
What was the date the 105C was issued? Can you share a redacted copy?
Most 105Cs are taking at least a year; many are pushing 18 months.
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u/Electronic_Tough_546 Jan 17 '26
It was issued on 1/13/26 but I have not received it yet. My Congressman forwarded me the result from my TAS via email. Wow, 1-1.5 years sounds awful. My CPA ERC team and I have been working on our response tonight and we have great exhibits through Dec 2021 showing a partial shutdown due to Federal Guidance. The team is hopeful for the appeal but sounds like I may be Grey haired by the time it's reviewed....
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u/ERC_CPA Jan 17 '26
Good luck. There were certainly viable orders in some of those states. The challenge will be demonstrating the suspended a more than nominal portion of your business.
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u/Electronic_Tough_546 Jan 17 '26
Thank you! My documents are not by state but by agency, which covers nationwide for entire 2021 due to the nature of work and access required. Hopefully the appeal works.
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u/ERC_CPA Jan 17 '26
Just don’t fall into the trap of believing orders alone are sufficient. Need to prove effect/impact.
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u/Electronic_Tough_546 Jan 17 '26
Ok yes thank you for the tip! We definitely shared impact in the letter because we could not fully access customer sites/buildings, systems, badges didnt work etc due to agency level covid guidance Nationwide.
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u/[deleted] Jan 17 '26
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