A federal court ruling has opened a window for millions of Americans to claim refunds on COVID-era tax penalties and interest paid to the IRS. The deadline to file these claims is Friday, making speed critical for eligible taxpayers.
The ruling addresses penalties and interest the IRS assessed during the pandemic when filing and payment deadlines shifted. Taxpayers who paid these charges may recover that money through an IRS refund claim, though eligibility depends on specific circumstances tied to your tax situation during 2020 and 2021.
To pursue a refund, you'll need to file Form 843 (Claim for Refund and Request for Abatement) with the IRS. This form requests relief from penalties and interest charges you believe were wrongly applied. The court decision strengthens arguments that certain pandemic-related penalties should never have been assessed in the first place.
Who qualifies? Generally, taxpayers who faced penalties for missed filing deadlines, late payments, or underpayment of estimated taxes during the pandemic months qualify if they can demonstrate reasonable cause. The IRS initially waived some penalties automatically, but others required formal claims.
The refund amounts vary widely. Some taxpayers may recover hundreds of dollars in interest charges alone. Others might recoup thousands if they faced multiple penalty assessments. Interest compounds over time, so penalties assessed early in the pandemic have accumulated considerably.
Filing before Friday requires immediate action. You can file Form 843 electronically through the IRS website or by mail, though mail carries delivery risk at this deadline. Many tax professionals are expediting these claims for clients, so contacting a CPA or tax attorney could accelerate your filing.
Keep documentation handy. The IRS will request proof of your pandemic-related hardship or the specific circumstances justifying penalty relief. Previous correspondence with the IRS about payment extensions, filed returns, and proof of payment strengthen your claim