IRS Restarts Processing of Some ERC Refunds: What to Know
Some businesses may receive employee retention tax credit (ERC) payments as early as September.


Still looking for your IRS Employee Retention Tax Credit (ERC) check? You’re not alone. Over 1.4 million people may be waiting for their ERC claims to be processed.
But there is some good news on this front. After almost a year following an IRS moratorium on ERC claims processing, the agency announced plans to resume processing claims for this pandemic-era refundable tax credit.
The announcement came after several hundred million dollars in new ERC claims were fraudulently filed and a bipartisan tax deal fell through in Congress that could have ended the ERC program entirely.

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Despite countless problems with claiming the ERC, select businesses are set to potentially receive thousands in tax credit payouts.
When can ERC refunds be expected?
The IRS says it is issuing 50,000 valid ERC claims. The agency has identified these claims as being at “low-risk” of improper filing. When issuing funds for these claims, the IRS will focus on the filing period from September 14, 2023, through January 31, 2024.
Businesses whose ERC claims fall into this category can expect their claims to begin being processed by the tax agency in September. There will likely be additional payouts later in the fall.
IRS ERC audits
Although the IRS is processing low-risk ERC claims, it is still on watch for phony ones. The tax agency has sent 58,000 rejection letters to businesses, amounting to $6 billion in incorrect claims. The IRS also said it has initiated 460 criminal cases involving improper ERC claims.
Here is a breakdown of criminal investigations concerning those cases:
- 37 investigations resulting in federal charges so far
- 17 investigations resulted in convictions
- 9 sentences resulted in an average sentence of 20 months
Thousands of other claims are undergoing audit. Businesses are invited to proactively withdraw their ERC claim if they believe their filing to be erroneous. So far, more than 7,300 entities have withdrawn claims, with a combined total of $677 million in claimed credits.
Voluntary Disclosure. Because of all the incorrect filings, the IRS has temporarily reopened the Voluntary Disclosure Program for businesses to fix their improperly filed claims. If you believe this to be you, you can pay back your errant claim at a 15% discount to the IRS (as well as avoid future penalties, audits, or fees associated with the incorrect claim). But only for a limited time. This program will close after November 22, 2024.
If your ERC was rejected
There may be a limited number of improperly denied ERC claims. If you think that applies to you, here are a couple of steps you can take:
- Respond to the address on the denial letter stating your appeal
- File an administrative appeal using the information on the IRS website
Note: Recent rejection letters may have mistakenly omitted the paragraph about the appeals process. You may receive a follow-up letter from the IRS with this information included.
Employee retention credit claim approval time
The IRS will process the highest and lowest risk claims first. If your business falls more middle-of-the-road in terms of assessed risk, you may have to wait longer for your claim to be processed.
In the meantime, you may receive partial employee retention tax credit payments for valid tax periods (generally quarters) throughout the year. This is because your eligibility can vary from one tax period to the next. For example, you may have received the Paycheck Protection Program loan during one tax period, which would change your ERC eligibility for the next.
With more than 17,000 claims coming in to the IRS every week, and 50,000 new claims getting processed, the agency has undertaken a massively resource-intensive task. The total payout is unknown. The timeline for new claims is unknown. But many businesses may not receive their ERC for months — perhaps even years — in the future.
Related Content
- IRS Employees Owe $50 Million in Taxes
- What’s Happening With the Employee Retention Tax Credit
- A Bunch of IRS Tax Deductions and Credits You Need to Know
Get Kiplinger Today newsletter — free
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

Kate is a CPA with experience in audit and technology. As a Tax Writer at Kiplinger, Kate believes that tax and finance news should meet people where they are today, across cultural, educational, and disciplinary backgrounds.
-
Stock Market Today: Good Feelings and Solid Data Lift Stocks
Resilience and de-escalation defined another generally positive day for financial markets.
-
Five Home Upgrades for Surviving Record-Breaking Heat
With global temperatures expected to hover at record highs for years to come, now’s the time to upgrade your home for long-term heat resilience.
-
Ask the Editor, June 6: Questions on Hobby Losses, Medicare
In our latest Ask the Editor round-up, Joy Taylor, The Kiplinger Tax Letter Editor, answers questions on hobby losses, I bonds and Medicare premiums.
-
Homeschoolers: 529 Plan Savings Could Soon Work for You
Savings Accounts A new House GOP bill could change how you save for your child's homeschool education. Find out how.
-
Five ‘Big Beautiful Bill’ Tax Changes to Watch in the Senate
Tax Policy The House passed its version of Trump’s "One Big, Beautiful Bill." Here’s what to look for as Senate Republicans take up the mega legislation.
-
Ask the Editor, May 30: Questions on the One Big Beautiful Bill
Ask the Editor In this week's Ask the Editor Q&A, we answer tax questions from readers on the House-passed “One Big Beautiful Bill.”
-
New GOP Car Loan Tax Deduction: Which Vehicles and Buyers Qualify
Tax Breaks To fulfill Trump's campaign promise, House GOP lawmakers want to offer a tax deduction for car loan interest. How would it work?
-
Ask the Editor, May 23: Reader Questions on Gifts, Estate Tax
In this week's Ask the Editor Q&A, we answer tax questions from readers on gifts, the estate tax and stepped-up basis upon death.
-
Big GOP Tax Bill Could Change Your Estate Planning for 2025
Tax Law The GOP might extend and increase the higher estate and gift tax exemption and AMT thresholds. What might this mean for your estate plan?
-
Ask the Editor, May 16 — Reader Questions on Capital Gains
In our latest Ask the Editor round-up, Joy Taylor, The Kiplinger Tax Letter Editor, answers three questions from readers on capital gains.