Court Ruling Extends IRS Refund Claims to July 2026 for COVID-Era Penalties and Credits

Millions of Americans must file claims with the IRS by July 10 to secure potential refunds stemming from a federal court ruling on COVID-19 tax deadlines, National Taxpayer Advocate Erin Collins said in a blog post. A judge ruled in November that the IRS should have suspended filing and payment deadlines during the disaster declaration that ran from January 20, 2020, through May 11, 2023.

The standard 60-day extension after the declaration ended set an original deadline of July 10, 2023.

Taxpayers generally have three years after filing a return or two years after paying a tax, penalty or interest to claim a refund. Because the court extended the 2023 deadline, affected individuals now have until July 10, 2026, to request refunds or file protective claims. Collins stated that the relief will not occur automatically and that most taxpayers must submit a claim by the deadline.

Eligible taxpayers include those assessed penalties or interest on returns filed during the disaster period, those who paid or still owe such charges for late filing or payment, and those who filed international information returns late. Others who believe they missed refundable credits, withholding credits, estimated tax payments or other benefits during the period may also qualify.

Collins noted the refunds could provide significant support, particularly for low-income workers and families through withholding, credits or stimulus-related benefits.

Taxpayers seeking refunds for penalties or interest should file Form 843 and write "Protective Refund Claim Pursuant to Kwong Case" at the top. Those needing to adjust income, deductions, credits or filing status should use Form 1040-X. Collins said the process "is not a fair result for taxpayers" and that she suspects only a tiny fraction of eligible people will file timely claims.