If the IRS charged you late fees, failure-to-pay penalties, or underpayment interest between January 2020 and July 2023, you might be entitled to get that money back.
A federal judge recently ruled that the IRS unlawfully penalized taxpayers during the COVID pandemic national emergency, creating a massive, but temporary, opportunity to claw back those specific fees.
Why is this happening?
In a recent case (Kwong v. United States), a federal judge determined that all tax deadlines during the pandemic were legally paused. Because the clock was stopped, the IRS had no legal authority to assess failure-to-file or failure-to-pay penalties, or underpayment interest, during that 3.5-year window. Simply put, the IRS overstepped, and now taxpayers can hold them accountable for those extra charges.
How much money are we talking about?
Because you owed the IRS a balance during this timeframe, you could potentially recover 100% of the failure-to-file, failure-to-pay, and underpayment interest charged between January 20, 2020, and July 10, 2023.
Please note: This opportunity does NOT reduce your original tax debt (the principal amount of tax you owed). However, stripping away 3.5 years of unlawfully compounded penalties and interest could result in a substantial cash refund for fees you’ve already paid, or significantly lower the total overall balance the IRS says you currently owe.
Why do I need to act now?
The IRS won’t automatically fix this for you, and there are strict legal deadlines for claiming relief. Because the court ruled that pandemic tax deadlines were officially extended to July 10, 2023, the 3-year window to claim refunds tied to those returns is rapidly closing.
For many taxpayers, this creates an imminent, hard deadline of July 10, 2026, which is now less than four months away. You must get your claim on file before this fast-approaching cutoff or lose the right to recover these funds forever.
Legal Caveat: As with many major rulings, the IRS may attempt to appeal this decision. However, because your personal deadline to claim a refund is ticking away right now, we strongly advise filing a claim immediately to protect your rights, regardless of what the IRS does next.
Next Steps
Contact us today to find out exactly how much in penalties and interest the IRS needs to refund you or wipe from your account.
Frequently Asked Questions
What exactly is a “claim”?
Filing a claim is the formal legal process of requesting a refund from the IRS. A complete claim submission includes preparing an IRS Form 843 alongside a detailed written legal argument proving your eligibility for this specific relief. Because of strict IRS rules, a completely separate claim must be prepared and filed for each individual tax year involved.
What types of taxes are eligible for this relief?
This ruling covers a broad range of federal taxes outlined in I.R.C. § 7508. This includes employment and payroll taxes, individual and corporate income taxes, estate and gift taxes, and excise taxes.
Does this apply to my state tax debt?
No. This ruling applies only to federal tax debt owed to the IRS, not to state-level tax agencies.
Do I need to have already paid off the tax debt?
No. You do not need to have a zero balance on your original principal tax debt to pursue this opportunity.
Do I need to have paid all the interest and penalties in full to qualify?
No. If your penalties and interest are currently unpaid and sitting on your account, we can request an abatement on your behalf, often by filing a Collection Due Process Hearing Request.
