TaxNow’s ERC Recap: The Real Story Isn’t Refunds — It’s the Clock

TaxNow

29 Apr 2026

ERC Trend Recap

This week’s data showed an uptick in refunds and average check size, but that’s not the story that matters.

ERC activity remains well below normal levels and continues to be driven primarily by special situations, not broad-based claim processing. We did see a modest increase in resolved 105C and 106C cases, including one large ~$800K Q3 2021 partial suspension claim.

But zooming out, the system still isn’t moving in a way that would suggest meaningful progress on the broader backlog.‍

The Real Development: Form 907 Goes "Streamlined"

The most important development this week came from the National Taxpayer Advocate’s announcement of a “streamlined” process for submitting Form 907 requests.

At a high level, the message is simple and critical: The two-year refund suit clock is running on denied claims. ‍

And if that clock runs out, taxpayers risk losing their ability to pursue a refund entirely.

The IRS’s response is to offer a more centralized way to submit Form 907 (Agreement to Extend the Time to Bring Suit), primarily through the Document Upload Tool (DUT).

Our Take

This is directionally helpful…but let’s not overstate it.

Functionally, this is only marginally different from what should already exist:

The IRS should already be accepting Form 907 via mail or e-fax

The Document Upload Tool is, in practice, just a slightly more modern version of e-fax

The core issue hasn’t changed: you are still relying on the IRS to process and execute the form correctly and timely

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And based on what we’re seeing, that’s not something to take for granted.

We fully expect continued rejections of Form 907 submissions for technical or arbitrary reasons; things like formatting discrepancies (e.g., “March 2028” vs. “03/2028”), routing issues, or internal handling delays.

So while the “streamlined” label sounds reassuring, the operational reality is unchanged: Practitioners still need to treat Form 907 as a high-risk, time-sensitive process that requires active management…not passive submission.