A recent federal court decision, Kwong v. United States, may create an opportunity for some taxpayers to seek refunds or other relief for certain IRS penalties and interest connected to the COVID-19 period. Although the law is still developing, July 10, 2026, may be an important deadline either for preserving those claims or requesting a refund or abatement. We are monitoring this area and evaluating whether the ruling may be relevant based on individual circumstances.
Why This Matters
During the COVID-19 declared emergency, special disaster-relief rules postponed certain tax deadlines. In Kwong, taxpayers who paid certain penalties and interest – or still have unpaid assessed amounts from that period – may want to review whether relief is available. This issue may apply to a wide range of taxpayers, including individuals, businesses, and trusts/estates.
Items Worth Reviewing
- Failure to file and pay penalties
- Certain estimated tax penalties and interest
Important Reminders
- There may be a limited‑time opportunity to recover penalties and interest paid during the pandemic.
- The IRS will not issue refunds automatically.
- Action is required by July 10, 2026, but in some situations the deadline could be earlier.
- We can help determine eligibility and file protective claims or claims for refund or abatement of penalties and interest where appropriate.
Please contact a member of Gould & Ratner’s Tax Planning & Structuring Practice to discuss how these changes may affect you. As always, planning ahead can help you maximize your financial situation and position you for greater success.
