IRS Pandemic Penalty Refund Deadline Approaches For Millions/ Newslooks/ WASHINGTON/ J. Mansour/ Morning Edition/ Millions of taxpayers may qualify for refunds tied to pandemic-era IRS penalties. Most eligible Americans must apply before the July 10 deadline. The refunds stem from a federal court ruling involving COVID-era tax deadlines.
IRS Pandemic Refund Quick Looks
- IRS penalties during COVID may be refundable
- Millions affected by late filing penalties
- July 10 deadline approaching quickly
- Refund claims require filing IRS Form 843
- Federal court ruling triggered refund eligibility
- Taxpayer advocate urges immediate action
Deep Look
Millions May Qualify For IRS Refunds
The issue stems from a federal court ruling that determined taxpayers may not have been legally required to file taxes on time during portions of the COVID-19 emergency period.
The potential relief applies to penalties assessed between January 2020 and July 11, 2023.
Refunds Are Not Automatic
Unlike some previous IRS relief programs, taxpayers generally must actively apply to receive refunds or penalty abatements.
Most eligible taxpayers have until July 10 to file claims preserving their rights.
The independent National Taxpayer Advocate is warning that many Americans may miss the deadline if they fail to act quickly.
The agency described the issue as:
“Widespread and not limited to a small or specialized group of taxpayers.”
Court Ruling Sparked Refund Claims
The controversy centers on the federal case Kwong v. U.S.
The court ruled that COVID-era emergency laws effectively extended filing deadlines, meaning some penalties assessed by the IRS may have been improper.
The ruling remains under litigation, and the Trump administration continues challenging the decision.
Treasury Department official Ken Kies said the administration believes the ruling:
“Was wrongly decided because it is a misreading of the plain language of the statute.”
Still, tax experts recommend taxpayers preserve their claims while the case proceeds.
Who May Be Eligible
Potentially eligible taxpayers include people who:
- Filed tax returns late between Jan. 20, 2020, and July 11, 2023
- Paid penalties for late filing or payment
- Still owe unpaid penalties from that period
- Filed international information returns late
The IRS reportedly assessed more than 120 million penalties during the pandemic period.
How Taxpayers Can Apply
Tax experts say eligible taxpayers should:
- Review IRS online tax account transcripts
- Identify penalties assessed during the covered period
- Complete IRS Form 843
- Mail the form to the appropriate IRS service center
The claims must generally be submitted through traditional mail rather than electronically.
Alyssa Maloof Whatley of Frost Law advised taxpayers not to wait.
“By preserving your claim, you’re actually preserving your right to that money,” she said.
Low-Income Americans Could Be Most Affected
The National Taxpayer Advocate warned that lower-income taxpayers may be especially vulnerable to missing out on refunds.
Many affected Americans:
- May not have professional tax representation
- Could be unaware of the legal ruling
- May not realize they qualify for refunds
Officials say the complexity of the legal process may discourage eligible taxpayers from applying.
IRS Litigation Still Ongoing
The federal government continues fighting the Kwong decision in court.
If the ruling is ultimately overturned, taxpayers who filed claims may not receive refunds.
However, legal experts stress that missing the filing deadline now could permanently eliminate any future eligibility.
That uncertainty has prompted tax professionals to encourage precautionary filings before July 10.
Why The Deadline Matters
Tax deadlines tied to refund claims are often strictly enforced.
Experts say taxpayers who delay could lose access to:
- Refund payments
- Penalty reversals
- Future legal protections
The National Taxpayer Advocate urged taxpayers to immediately review their records and determine whether penalties were assessed during the pandemic emergency period.
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