There’s a significant tax refund opportunity that tens of millions of Americans don’t know about yet — and the window to claim it closes on July 10, 2026. If you were assessed IRS penalties or interest between January 20, 2020, and July 10, 2023, a recent federal court decision suggests that those charges may have been improper. Here’s what happened, who’s affected, and exactly what you need to do.
The Court Case Behind This
In November 2025, the U.S. Court of Federal Claims issued a landmark decision in Kwong v. United States. The case hinged on a section of the tax code — IRC § 7508A(d) — that governs how federal tax deadlines are handled during a presidentially declared disaster.
The court ruled that because COVID-19 was a federally declared disaster from January 20, 2020, through May 11, 2023, all federal tax filing and payment deadlines should have been automatically postponed for that entire period — plus an additional 60 days — pushing the effective deadline to July 10, 2023. By the court’s reasoning, the IRS should not have assessed failure-to-file penalties, failure-to-pay penalties, estimated tax penalties, or related interest charges during that nearly 3.5-year window.
It’s important to note that the IRS disagrees with the ruling, and the Department of Justice is expected to appeal. That’s exactly why acting now — before July 10 — is so critical.
Who Could Be Affected?
This issue is not limited to a small or specialized group of taxpayers. Impacted taxpayers represent a broad cross-section of the public, including individuals, small businesses, large corporations, estates, and trusts. 11 Alive
You may qualify if any of the following happened between January 20, 2020, and July 10, 2023:
- You filed a federal tax return late
- You paid a penalty for filing or paying late
- You made estimated tax payments late
- You were charged interest by the IRS
- You still owe IRS penalties from that period, even if you never paid them
- You filed a late international information return, which can carry significant penalties even when no tax is due
The issue reaches taxpayers with income taxes, employment taxes, estate taxes, gift taxes, and excise taxes.
This Relief Is Not Automatic
This is the most important point: the IRS will not send you a check on its own. The IRS is currently appealing the decision and has not begun issuing refunds. A protective refund claim filed now is what locks in your right to a refund if the IRS ultimately loses the case. Windham Brannon
As National Taxpayer Advocate Erin M. Collins has stated directly: without a timely filing, the statute of limitations closes, and the refund window is permanently gone — regardless of how the appeal turns out.
What You Need to Do
This is the most important point: the IRS will not send you a check on its own. The IRS is currently appealing the decision and has not begun issuing refunds. To receive anything, you have to proactively file a claim — and that claim has to be filed correctly and on time. Windham Brannon
That’s where things get complicated. Identifying which penalties qualify, pulling the right records from your IRS tax transcripts, calculating the correct amounts across potentially multiple tax years, and filing the proper paperwork in the right way — all before a hard deadline — is not a straightforward process. Filing incorrectly or incompletely can jeopardize your claim. And because the legal outcome is still uncertain, the right approach involves filing what’s known as a protective claim, which preserves your rights while the courts continue to sort out the final ruling.
This is not a do-it-yourself situation for most people. The details matter, the deadline is firm, and the cost of getting it wrong is losing the refund entirely.
Watch Out for Scams
Any time there is news about IRS refunds, scammers follow. Be cautious about who you ask for help. Avoid anyone who charges a fee based on the size of your refund, pressures you into positions you don’t understand, or asks for sensitive personal information upfront. The IRS has resources on tax scams worth reviewing before engaging with any third party. 11 Alive
Work only with a licensed, qualified tax professional like Morris and Associates who understands IRS procedures and can review your actual account history before recommending a course of action.
The July 10 Deadline Is Real — Don't Wait
Whether this is worth pursuing depends on your specific tax history — how much you were penalized, when you paid, what years are involved, and how your returns were filed. There’s no one-size-fits-all answer, and the only way to know for sure is to have someone who knows what they’re looking at review your situation.
At Morris and Associates, Ken Morris sits down personally with every client. He’ll review your tax history, evaluate whether you have a legitimate claim worth pursuing, and handle the entire process correctly and on time. You won’t be handed off to a junior preparer or left to figure it out on your own.
July 10 is only weeks away. If there’s any chance you were assessed IRS penalties or interest during the COVID years, the time to find out is now — not after the deadline has passed.
Contact Morris and Associates today for a free consultation. There’s no obligation, and it could be worth real money.
