IRS Taxpayer Advocate Issues Critical Notice
The IRS's taxpayer advocate has put out a notice stating that tens of millions of American taxpayers could be in line for refunds or reductions in penalties and interest. This stems directly from the postponement of filing deadlines during the COVID-19 emergency declaration period.
In a post released on Thursday, the National Taxpayer Advocate highlighted that refunds or abatements might apply to penalties and interest assessed by the IRS over the 3.5-year COVID disaster declaration span. Recent court decisions, particularly the ruling in the Kwong case, have clarified how the tax code treats federal disaster declarations, effectively postponing filing and payment deadlines nationwide from January 20, 2020, through May 11, 2023.
Court Rulings Trigger Widespread Relief Opportunities
The core issue arises from these court interpretations, which extend deadline relief across the entire COVID period. The Justice Department could appeal, but for now, the relief isn't automatic—taxpayers hit by this must file their own refund claims by July 10, 2026.
Most taxpayers and even tax professionals overlooked the full scope of these extensions because COVID disasters rarely drag on for so long. The logical outcome of the court's ruling means returns and payments weren't late during that window, so no penalties or interest should apply. Without action from the IRS or Congress to automate this for everyone, individual claims become essential, with that 2026 deadline closing in fast.
Because of the frequency of a disaster lasting this long, most taxpayers, even most tax professionals, did not foresee that filing deadlines and payments deadlines would be postponed for this long and that return filings and payments would not be considered late and therefore not subject to penalties and interest.
Filing Claims: Process and Precautions
Affected taxpayers may seek refunds or abatements for penalties and interest charged on filings or payments during the COVID period. The IRS demands claims via Form 843, submitted on paper only—no electronic option exists yet. To prove timely filing, especially if forms go missing, send via certified mail for receipt confirmation.
The advocate stresses urgency: unless the IRS or Congress steps in with systemic relief, most must file by July 10, 2026. The goal here is straightforward—spread the word widely to prevent uneven outcomes where only the informed get relief.
At the risk of repetition, my overriding goal is to get the word out to as many taxpayers as possible and to avoid disparate results between the 'well advised' and the unaware.
Recommendations for IRS and Broader Action
The National Taxpayer Advocate urges the IRS to follow the Taxpayer Bill of Rights with four key steps: publicize the issue broadly, grant a six-month extension for claims, explore systemic relief to skip individual filings, and build an electronic submission portal.
Tax professionals should notify clients, Congress members should flag this in constituent outreach, and media outlets need to cover it for public awareness. This push aims to ensure no taxpayer misses out due to lack of information, keeping the process equitable amid potential appeals or legislative changes.
