National Taxpayer Advocate flags millions for Irs Covid Refund Deadline
The National Taxpayer Advocate said tens of millions of taxpayers may be entitled to refunds or reduced penalties and interest tied to the irs covid refund deadline. The claims window stems from deadlines postponed during the COVID-19 emergency declaration, and most affected taxpayers will need to act by July 10, 2026.
National Taxpayer Advocate notice
On Thursday, the National Taxpayer Advocate said refunds or abatements may be available to tens of millions of taxpayers for penalties and interest assessed during the 3.5-year COVID disaster declaration period. The advocate wrote that the long length of the disaster period meant many taxpayers, including many tax professionals, did not expect filing and payment deadlines to be postponed for so long.
“Because of the infrequency of a disaster lasting this long, most taxpayers, even most tax professionals, did not foresee that filing deadlines and payments deadlines would be postponed for this long and that return filings and payments would not be considered late and therefore not subject to penalties and interest. But that is the logical extension of what the court ruled,” the National Taxpayer Advocate wrote.
Kwong ruling and deadlines
The issue comes from recent court decisions, including the Kwong case, which found that the tax code’s treatment of federal disaster declarations postponed filing and payment deadlines from Jan. 20, 2020, through May 11, 2023. The Justice Department may appeal the Kwong decision, and the relief is not automatic.
Taxpayers seeking refunds for penalties and interest paid during that period will, in most cases, need to file claims by July 10, 2026. The taxpayer advocate said claims generally will need to be filed on paper ahead of that deadline, unless the IRS changes its process.
IRS paper claims process
“Unless the IRS or Congress acts to ensure all affected taxpayers will receive refunds if the Kwong decision is upheld, taxpayers seeking refunds for penalties and interest they paid relating to that period will, in most cases, need to file claims by July 10, 2026,” the National Taxpayer Advocate wrote. The same post said the advocate’s goal was to reach as many taxpayers as possible and avoid uneven results between those who are well advised and those who are unaware.
“At the risk of repetition, my overriding goal is to get the word out to as many taxpayers as possible and to avoid disparate results between the 'well advised' and the unaware,” the National Taxpayer Advocate wrote.
For taxpayers who paid penalties or interest tied to the covered period, the immediate step is to review whether a paper claim is needed before July 10, 2026. If the IRS or Congress changes the process, that filing route could change, but the deadline identified in the notice is the one taxpayers are being told to watch now.
