IRS Pandemic Refund? What You Need to Know

A recent court decision in the United States has begun to draw attention among taxpayers and tax professionals due to its potential impact on IRS penalties and interest charged during the pandemic.

The case could open the door to refund claims with the IRS for those who paid charges between 2020 and 2023.

Why it matters: This ruling could allow thousands of taxpayers to recover money paid in penalties or interest during the pandemic, in a context where tax deadlines may have been suspended longer than previously believed.

The Ruling That Could Mean an IRS Pandemic Refund

According to USA Today, the case Kwong v. United States, resolved in November 2025 by the U.S. Court of Federal Claims, concluded that certain tax relief measures during the pandemic suspended key deadlines in the federal tax system.

The decision establishes that these deadlines were paused from January 20, 2020, to July 10, 2023.

This includes not only tax filing deadlines but also periods related to claims, payments, and penalties.

The key point is that if deadlines were suspended, some charges applied during that period may not have been valid—directly affecting IRS pandemic refund eligibility.

IRS pandemic refund eligibility – PHOTO: Shutterstock

What Charges Could Be Refunded

According to legal analysis, the scope of the ruling could benefit taxpayers who paid different types of penalties during the pandemic.

Possible cases include late filing penalties, failure-to-pay charges, and interest accrued on tax debts.

Additional charges tied to audits or installment agreements could also fall under this scenario, as long as they occurred between January 2020 and July 2023.

The reasoning is that if there was no active obligation due to suspended deadlines, those charges may be questionable—potentially strengthening IRS pandemic refund eligibility claims.

Who May Qualify for Tax or Penalty Refunds

The potential benefit is not limited to a specific group.

Both individuals and businesses that incurred IRS charges during the pandemic may evaluate whether they qualify for a refund.

The main criterion is having been affected by penalties, interest, or other charges within the suspension period defined by the court.

For that reason, reviewing tax records from those years is essential to determine IRS pandemic refund eligibility.

IRS pandemic refund eligibility – PHOTO: Shutterstock

Deadlines You Cannot Ignore

One of the most important aspects is the time available to file a claim.

Under general rules, refund requests must be made within a specific timeframe from when the return was filed or the tax was paid.

Based on the court’s interpretation, this deadline could extend until July 10, 2026, creating a limited window to act.

This means that anyone who believes they overpaid during the pandemic should review their situation as soon as possible to preserve IRS pandemic refund eligibility.

What You Should Do If You Think You Qualify

The first step is to review your tax history for the affected years, including returns, payments, and any penalties applied by the IRS.

It is also advisable to consult your tax transcripts or seek guidance from a tax professional to identify potential refund opportunities.

Although the IRS could appeal the decision, waiting may result in missing the legal deadline to request a refund.

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What’s Next

The case could still evolve if appeals or new legal interpretations arise. However, interest in the decision continues to grow as deadlines approach.

For taxpayers, this represents a real opportunity to review their financial situation and, in some cases, recover money paid during one of the most challenging periods in recent history.