Are You Eligible for Substantial IRS Refunds from the COVID-19...

(NEXSTAR) – A large number of Americans might be eligible for IRS refunds or waivers connected to the COVID federal disaster period. However, navigating the process to obtain these substantial benefits can be tricky. Fresh guidelines are now available to facilitate the procedure.

Recently, Erin M. Collins, the National Taxpayer Advocate, highlighted a “major refund opportunity” stemming from new court rulings. Collins works with the Taxpayer Advocate Service, which is an independent entity within the IRS.

Due to a recent court decision, the IRS “should not have imposed penalties for late submission or payment” throughout the COVID federal disaster period, which spanned from January 2020 to May 2023. For tax purposes, an additional 60 days were tacked on, extending the period to July 10, 2023.

While an appeal from the Department of Justice is anticipated, Collins advised eligible taxpayers to act promptly, as the deadline is just a little over two months away.

Who may qualify?

According to the TAS, you may qualify if the IRS assessed: penalties for failing to timely file your returns, pay your taxes, or make estimated tax payments; interest that began accruing earlier than it should have or not at all; or overpayment interest for the same time period.

Tens of millions of taxpayers — individuals, small businesses, large corporations, trusts and estates — were assessed penalties or interest during the COVID era, TAS says.

How can I tell if I qualify?

In a new blog post on Tuesday, Collins suggested those who believe they may qualify obtain and review their IRS tax account transcripts.

You can use an online account, available for individuals and businesses, with the IRS to obtain your transcript. You can also request them by mail, the TAS explains.

Your transcript shows when you filed your tax return and the taxes that were assessed, as well as any payments, credits, penalties, interest, or refunds associated with the filing.

While they can appear overwhelming, Collins recommends focusing “on dates and transaction entries, paying close attention to entries relating to tax assessments, payments, penalty assessments, interest charges, account adjustments, and refunds” between January 20, 2020, and July 10, 2023. The IRS offers guidance on reading tax account transcripts.

If you find any of the aforementioned information during the pertinent timeline, you may want to file a claim.

What should I do if I qualify?

If you are owed a refund or tax abatement, Collins writes, you’ll need to file a claim with the IRS.

Collins noted in the blog that “unless the IRS or Congress acts to ensure all affected taxpayers will receive refunds … taxpayers seeking refunds for penalties and interest they paid relating to that period will, in most cases, need to file claims by July 10, 2026.”

You will need to complete a Form 843, which cannot be done online. That means you’ll need a paper form.

The filing must be made within three years from the date that you filed your tax return, or two years from the date the tax was paid.

You may also want to consider a protective claim, allowing “you to preserve your right to a refund while the law is still uncertain,” TAS says. This can be done with Form 843 by the same July date.

“This is a complex and evolving legal issue,” Collins wrote, encouraging those who believe they may be impacted to speak with a tax professional.

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Are You Eligible for Substantial IRS Refunds from the COVID-19 Period? Here’s How to Find Out!

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