Letter 86C is an interim transfer notice. The IRS office that received your inquiry or forms is forwarding them to another office that is responsible for resolving the matter. Letter 86C does not, by itself, disallow a refund claim.
What to Do
Read the transfer destination and expected response time. Keep Letter 86C with a copy of what you sent and proof of delivery. Usually no new submission is needed unless the letter asks for one.
Keep Existing Deadlines
An administrative transfer does not necessarily extend a filing, appeal, petition, or refund-suit deadline created by another notice or statute. Continue tracking any pre-existing deadline while waiting for the receiving office to respond.
If the expected response time passes, contact the number on the letter and reference the date and subject of the transferred inquiry.