Webinar | The IRS May Owe You: Recover COVID-Era Penalties Before the July 10 Deadline
During the COVID-19 pandemic, the IRS declared a nationwide disaster that legally extended tax filing and payment deadlines. However, as discussed in this session, IRS systems continued to automatically assess late-filing and late-payment penalties—and apply interest—as if those extensions were not in place.
In this webinar, HRlogics breaks down what many in the tax community are calling a landmark development: a federal ruling that may entitle taxpayers to recover penalties and interest paid between 2020 and 2023. The session explains how this situation occurred, what the courts have determined, and what actions taxpayers should take now to preserve potential refunds.
Throughout the discussion, the speakers walk through the legal foundation behind this opportunity. In Abdo v. Commissioner (2024), the U.S. Tax Court ruled that penalties assessed during the COVID disaster period were improper under existing law. This was reinforced by Kwong v. United States (2025), where the court determined that the IRS must refund both penalties and interest applied during that same period. These are binding rulings—not interpretations—and they establish the basis for current refund claims.
The webinar also explains the specific timeframe tied to this opportunity. Under the Kwong decision, tax deadlines for affected periods were effectively extended through July 10, 2023. As a result, taxpayers who were penalized for late filing or payment during that window may not have actually been late. This applies to both individuals and businesses across multiple tax years and filing types.
From there, the session outlines how taxpayers can take action. The speakers walk through the process of identifying eligibility, authorizing secure, view-only access to IRS transcripts, calculating potential refund amounts, and filing Form 843 to formally submit a claim. They also emphasize that filing now serves as a protective action—preserving eligibility even as the IRS is expected to appeal the ruling.
In addition to paid penalties, the webinar highlights that assessed but unpaid penalties may also qualify for relief through abatement. The opportunity extends beyond common penalties to include interest charges, failure-to-deposit penalties, and certain information return penalties such as those tied to Forms W-2, 1099, and ACA filings.
The session also sets clear expectations around timing and outcomes. While the IRS has already issued more than $1.2 billion in refunds, claims are not processed automatically. Taxpayers must file to recover what they may be owed, and current processing timelines are estimated at three to six months, with potential delays depending on IRS volume.
Most importantly, the speakers reinforce that this opportunity is time-sensitive. Claims must be filed by July 10, 2026. Waiting for the final resolution of potential appeals could result in missing the filing window entirely.
What attendees learned:
- Deadlines Were Extended—But Penalties Continued
COVID-era IRS penalties may have been assessed despite legally extended deadlines, as automated systems continued charging penalties and interest during the disaster period. - Court Rulings Open the Door to Recovery
Two federal court decisions established that these penalties and interest may not have been valid, creating a path for taxpayers to pursue refunds or abatements. - Filing Now Protects Your Right to Recover
Submitting Form 843 preserves your claim while appeals move forward, with a firm deadline to file by July 10, 2026.
For CPAs, finance leaders, business owners, and individual taxpayers, this is a rare opportunity to recover funds tied to prior filings. With no upfront cost to check eligibility and a limited window to act, understanding the process—and taking timely action—can make a measurable financial difference.
Watch the full webinar recording on demand to see how eligibility is determined, how the claims process works, and what steps to take before the deadline.