IRS may owe you a COVID-era refund, but time is running out - here's how to claim it fast

IRS refund claim 2026 deadline: The COVID-19 pandemic may feel like a distant memory for many Americans, but its impact on taxes could still affect millions of people today. Tax attorneys say some individuals and businesses may be eligible for refunds related to penalties or interest charged by the Internal Revenue Service during the pandemic years, as per a report. However, the opportunity to make a claim will not last forever.

IRS COVID Refund Warning: Why Some Taxpayers May Be Owed Money

The issue comes from a federal court ruling issued in November that found the COVID-19 public health emergency qualified as a federally declared disaster under Section 7508A(d) of the tax code, as per an USA Today report. The emergency period lasted from January 20, 2020, through May 11, 2023.

Under that provision, tax deadlines are automatically postponed during a federally declared disaster and for an additional 60 days afterward. With that extension included, the deadline for filing tax returns for the 2019, 2020, 2021, and 2022 tax years would have been pushed to July 10, 2023, as per the USA Today report.


Tax lawyers say that if taxes were not considered due during that window, the IRS may not have had the authority to charge penalties or interest during the same period. As a result, taxpayers who were charged those costs could potentially qualify for refunds.

Still, taxpayers must act before the legal deadline passes. The statute of limitations for refund claims generally allows three years from when a return was filed or two years from when the tax was paid, whichever is later.

Also read: New IRS update could impact millions filing taxes this year - what you should know

July 10, 2026 Deadline: The Date Taxpayers Should Not Miss

Because the court ruling suggested that tax deadlines moved to July 10, 2023, three years from that date, July 10, 2026, would be the final day for taxpayers to file claims to preserve the possibility of a refund or a reduction in penalties.

Jon Wasser, a partner at Fox Rothschild who focuses on tax issues, said that, "Millions of taxpayers could be eligible, but if people don’t file claims before July 10, 2026, they lose out on the potential for a refund or abatement," as quoted by USA Today.

Who May Qualify for a COVID-Era IRS Refund

Individuals and businesses that were charged penalties or interest between January 20, 2020, and July 10, 2023, may be able to request refunds.

Meanwhile, the issue has already surfaced in a legal dispute. In February, Western Digital sued the government seeking a refund on part of the $53.6 million it paid in taxes in August 2023 after resolving a long-running tax dispute, as per the USA Today report. The company said it should not have been charged nearly $21 million in interest during the pandemic pause.

How to Check IRS Records to See If You Were Charged Interest or Penalties

Taxpayers who want to check whether they might qualify can review their IRS tax account transcripts. These transcripts show important information such as filing status, taxable income, payments, penalties, interest, and adjustments made after the original return was processed.

The IRS allows people to access transcripts online by registering for an Individual Online Account, where they can view, print, or download their records. Taxpayers can also request transcripts by mail through the IRS website or by calling the automated transcript service at 800-908-9946, with delivery typically taking five to ten calendar days.

How to Claim a Refund From the IRS

If a taxpayer believes they may qualify for a refund, they can file a claim themselves or work with a tax professional. Claims can be submitted using IRS Form 843, which is used to request a refund or abatement of penalties or interest.

Lawyers recommend that the form specify the claim as a protective claim related to the Kwong v. United States decision and the COVID-19 disaster period under Section 7508A(d), as per the USA Today report.

Filing a protective claim essentially alerts the IRS that a taxpayer is requesting a refund while the legal case continues. As Wasser explained, the step allows taxpayers to preserve their right to a refund if the courts ultimately determine that the IRS must issue them, as per the USA Today report.

FAQs

Why could some taxpayers receive a COVID-era tax refund?
Some taxpayers may have been charged penalties or interest during the pandemic period when tax deadlines were postponed.

What is the key deadline for filing a refund claim?
Taxpayers must file claims before July 10.