It’s possible that the IRS may owe you some money from the COVID era.
Last month, a U.S. Court of Federal Claims decision broadened the interpretation of a particular part of the tax code, IRC Section 7508A, which concerned the postponement of tax deadlines during disasters, such as the COVID-19 pandemic.
Specifically, a February ruling in Kwong v. United States (2025)—a lawsuit concerning a plaintiff’s attempt to get a refund for tax penalties—decided that deadlines for filing tax returns, paying taxes, or filing for refunds needed to be completed by July 11, 2023. So, if a taxpayer was supposed to file their 2020 tax return by April 15, 2021, the date was shifted to July 11, 2023.
Accordingly, this could have caused incorrect calculations by the IRS in terms of penalties, refunds, or claims of interest due on refunds. In effect, the courts are saying that the IRS didn’t have standing to charge penalties or interest while the emergency postponement was in effect, plus 60 days. The public health emergency caused by the pandemic lasted between January 20, 2020, and May 11, 2023. Sixty days after that: July 11, 2023.
In short: It’s possible that taxpayers could be due for a refund, or to have penalties or interest levied against them for unpaid taxes relieved. It’s possible, though, that the IRS and federal government can appeal the ruling, so nothing is set in stone.
How to find out if you may be owed money, and what to do next
For taxpayers who feel like they may be owed some additional relief—that is, they think they were unfairly charged penalties or interest during the period between January 20, 2020, and July 10, 2023—it’s possible to request a refund. One company, Western Digital, took action last month, suing the IRS for $21 million, claiming that it was unfairly charged interest during the disaster period.
As for individual taxpayers, you’ll want to check your tax records to see if you were actually hit with any penalties or interest during the disaster period, in order to ensure you have standing. That can be done by looking at your tax account transcript, available from the IRS. Further, you or a tax professional can file Form 843 with the IRS to request a refund using the information on the transcript.