There’s finally some good news for taxpayers who have been waiting to hear from the IRS. Years after the Employee Retention Credit (ERC) program ended, disputes over eligibility continue. Now, the IRS is allowing some taxpayers whose claims were denied to request an extension of time for review by the Independent Office of Appeals—offering a path to resolve cases without immediately resorting to costly litigation.

This change comes amid a backlog of questionable and disallowed ERC claims, many flagged for potential fraud, and strict deadlines that previously forced taxpayers to consider filing lawsuits to preserve their rights. Eligible taxpayers—generally those who received denial letters and are nearing the two-year deadline before they can no longer receive a refund—can request additional time by submitting Form 907, provided both they and the IRS agree on an extension before the original deadline expires.

But even as the IRS is offering some relief for taxpayers, new rules may add to the burden for some businesses. The Treasury Department and the IRS plan to revise Form 990 to enhance transparency and accountability for tax-exempt organizations, particularly around how funds are sourced, controlled, and used. While specific changes have not yet been released, the focus is expected to include greater scrutiny of fiscal sponsorship arrangements and more detailed reporting of government funding, reflecting concerns about oversight and potential misuse of funds.

These updates could introduce new schedules, expanded disclosures, and more narrative reporting, but they also raise concerns about increased administrative burdens and potential impacts on smaller organizations. As the rulemaking process unfolds, the challenge will be balancing more oversight with practical compliance challenges for nonprofits already navigating complex reporting obligations.

And there’s even more regulatory news in the non-profit sector. A case currently in federal court, Freedom Path Inc. v. IRS, highlights a growing conflict between tax law, First Amendment concerns, and congressional constraints. The issue in Freedom is how to define the limits of political activity for section 501(c)(4) social welfare organizations. With Congress effectively blocking the IRS and Treasury from updating guidance, the court has been placed in the unusual position of shaping the rules itself, particularly after finding existing standards potentially unconstitutionally vague. The outcome could significantly reshape how 501(c)(4) organizations engage in political campaigns, especially in a post-Citizens United landscape, where political spending has increased but regulatory clarity remains elusive.

The changing regulatory landscape has also been felt among the Big Four. KPMG is restructuring parts of its U.S. business, including laying off about 4% of its advisory workforce, cutting roughly 10% of its U.S. audit partners, and winding down its federal audit practice as market conditions shift. The changes reflect declining demand in certain advisory areas—particularly regulatory consulting—alongside lower-than-expected attrition after pandemic-era hiring.

The firm is also stepping back from federal audit work after the loss of a major U.S. Army contract, as the Department of Defense restructures its audit approach ahead of a 2028 deadline for a clean audit opinion (fun fact: in the last eight years, the Army has not received a clean audit). Despite the cuts, KPMG maintains that its overall........

© Forbes