IRS Letter 106C: IRS denied part of your employee retention credit
IRS Letter 106C is a return adjustment letter from the IRS. The IRS denied part of your Employee Retention Credit claim, often because it went over the per-employee limits. The IRS sends letters like this after it changes figures on a return.
What this letter usually means
The IRS denied part of your Employee Retention Credit claim, often because it went over the per-employee limits. A change can raise or lower what you owe or your refund. The letter shows both the old and new figures.
Category: The IRS changed your return
What people usually do first
If you disagree, respond with documents that support the amount you claimed.
What to have ready
- The 106-C letter
- An explanation and documents for each disputed quarter
- Your calculation worksheets
- A statement of wages left out
- Power of attorney papers if someone will represent you
What may come next
This letter does not point to a specific follow-up letter. Any later step will be described in mail from the IRS.
Read the IRS page
The IRS letter itself is the final word on what it means for you. Read the IRS page for 106C.
Common questions about 106C
What is IRS notice 106C?
The IRS denied part of your Employee Retention Credit claim, often because it went over the per-employee limits. It is also called 106-C.
How long do I have to respond to a 106C notice?
The date that matters is printed on your letter. Check it now, because this type of letter has a deadline that matters. The IRS page for 106C explains more.
Is a 106C notice a scam?
A real 106C comes by mail and should match your own records. You can also sign in to your IRS Online Account on irs.gov to see your account directly.
What should I have ready for a 106C notice?
The 106-C letter, An explanation and documents for each disputed quarter, Your calculation worksheets, A statement of wages left out, Power of attorney papers if someone will represent you.
Scan your letter in the OweRight iPhone app
The OweRight app can tell you what a 106C letter is and points you to the IRS page for it.
OweRight is not the IRS and does not give tax or legal advice.
Related notices
- IRS Notice CP240: IRS changed your payroll tax return
- IRS Notice CP250A: You must now file payroll returns each quarter
- IRS Notice CP250B: You keep filing Form 944 this year
- IRS Letter 105C: IRS denied your employee retention credit claim
- IRS Notice CP11: Changes to your return: you owe
- IRS Notice CP12: Changes to your return: refund changed