ERC Litigation

Advocating for Small Businesses in the ERC Program

Stenson Tamaddon is pursuing federal litigation to challenge IRS actions we believe unlawfully restricted ERC eligibility and disrupted processing. We bring a compliance-first mindset—and a willingness to litigate when necessary.

Read the Case Overview What This Means for Business

A Firm Built to Do the Work—and Defend It

We are a professional services firm that takes documentation, accuracy, and ethics seriously. Our work does not end at filing: when clients face delays, denials, or shifting administrative positions, we work to protect lawful claims through disciplined administrative advocacy—and when warranted, through litigation.

We pursue legal action selectively and responsibly. Litigation is not marketing; it is a tool of last resort to enforce statutory obligations and lawful process.

StenTam’s ERC litigation reflects our view that small businesses deserve fair administration of Congressionally enacted relief programs, and that agencies must follow the law when issuing binding rules and when pausing or slowing processing of claims.

Case Overview

StenTam filed a federal complaint seeking declaratory and injunctive relief and a writ of mandamus related to the administration of the Employee Retention Credit (ERC) program. The complaint alleges, among other things:

  • Unlawful Legislative Rules: The IRS issued binding rules through guidance (specifically Notice 2021-20) without following the notice-and-comment requirements of the Administrative Procedure Act (APA).
  • Unlawful Moratorium: The IRS imposed a moratorium that effectively paused or severely slowed the processing of new ERC claims without statutory authorization.
Relief Sought: The complaint asks the Court to vacate and enjoin enforcement of Notice 2021-20 absent compliance with the APA, and to declare the processing moratorium unlawful and compel the resumption of claim processing.

Key Legal Issues

1. Guidance vs. Regulations

The complaint argues that IRS Notice 2021-20 imposed substantive, binding requirements—effectively legislative rules—without the transparency and public participation required by the APA. We allege this guidance materially narrowed ERC eligibility by adding recordkeeping obligations and "nominal effect" thresholds not found in the CARES Act statute.

2. The Processing Moratorium

On September 14, 2023, the IRS announced an immediate moratorium on processing new ERC claims. The complaint asserts that Congress did not authorize the agency to unilaterally suspend the program and that eligible employers have statutory rights to have their claims processed within a reasonable time.

What This Means for Businesses

Every business situation is different. The points below are general considerations and should not be treated as individualized advice.

  • Processing Delays: Businesses with ERC claims may continue to experience processing delays due to the agency’s enforcement posture.
  • Documentation is Critical: Recordkeeping and substantiation remain essential. Businesses should maintain organized documentation supporting their eligibility theories and wage computations.
  • Litigation Paths: If a claim is denied, businesses may face administrative processes and potential litigation paths depending on their specific facts, timing, and jurisdiction.

Frequently Asked Questions

Is this page legal advice?

No. This page provides general information about the litigation and the ERC administrative environment. It is not legal advice.

Does the lawsuit mean I will receive my ERC refund?

No. Litigation outcomes are uncertain. Your claim depends on your specific facts, documentation, and applicable law.

Can StenTam help if my claim was denied?

StenTam may be able to assist with administrative follow-up and issue triage. If escalation is appropriate, we can discuss available paths and whether coordination with outside counsel is warranted.

How StenTam Supports Clients in High-Scrutiny Programs

We do not promise outcomes. We commit to disciplined work, candid guidance, and professional advocacy.

Compliance-First Delivery

We use structured workflows and review standards to support accurate filings, consistent documentation, and clear client communications—aligned with our Code of Ethics.

Administrative Advocacy

Where appropriate, we support clients through IRS-facing processes, including correspondence, follow-up, and issue triage, with careful documentation of timelines.

Litigation Readiness

When administrative pathways are ineffective, we evaluate escalation options, including formal disputes and litigation, and may coordinate with counsel depending on the matter.