Many Americans may want to move on from the COVID-19 pandemic, but revisiting that period could be beneficial—especially for taxpayers who may be eligible for refunds from the Internal Revenue Service, according to tax attorneys.
Federal law allows certain tax deadlines to be extended when a disaster is officially declared. In November, a federal court ruled that the COVID-19 public health emergency—from January 20, 2020, to May 11, 2023—qualified for relief under Section 7508A(d) of the tax code. With an added 60-day extension, the effective filing deadline for the 2019–2022 tax years shifted to July 10, 2023.
This extended window means the IRS may not have been allowed to charge penalties or interest during that time. Taxpayers who were assessed such fees could potentially request a refund, though the agency may contest the ruling, and there is limited time to act.
Tax attorney Jon Wasser says millions of individuals and businesses might qualify, but claims must be filed by July 10, 2026. Missing this deadline could forfeit the opportunity to recover any refunded penalties or interest.
Those who paid penalties or interest between January 20, 2020, and July 10, 2023, may be eligible for reimbursement. Experts note the refunds could be substantial, particularly for businesses that struggled financially during the pandemic and faced large late-payment penalties.
For example, Western Digital filed a lawsuit seeking to reclaim part of the interest it paid on a tax settlement, arguing it should not have been charged nearly $21 million during the pandemic-related extension period.
Normally, taxpayers have three years from the date a return is filed—or two years from the date taxes are paid, whichever is later—to request a refund. Since the court effectively extended the filing deadline to July 10, 2023, July 10, 2026, is expected to be the final day to submit claims for potential refunds or penalty relief.
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