dozens millions of americans It may still be possible to claim a COVID-19 tax refund, but they must act before the July 10 deadline. Refunds are tied to IRS penalties, late fees and interest charged during the COVID-19 emergency. The IRS is now making it easier to file claims by launching an online filing option for those who qualify.
Previously, taxpayers had to send Form 843 by mail or file it with a tax professional. On July 1, the IRS quietly added an electronic filing option for Form 843, but only for coronavirus-related refund requests. Qualified individual taxpayers with an IRS online account can use the online filing option through the IRS’s Mobile-Friendly Forms webpage. Businesses and individuals who don’t want to file online can still send paper Form 843 by mail, according to WCNC.
Why millions should apply before July 10
Tax experts say if millions of taxpayers don’t file a claim by July 10, they could lose their chance forever. The tax refund issue began after the federal court ruled in Kwong v. USA Last November. The court said federal tax filing and payment deadlines are automatically suspended during the COVID-19 federal disaster. According to the court ruling discussed by tax experts, this disaster period lasts from January 20, 2020, to May 11, 2023.
If the verdict is upheld, many taxpayers should not be charged penalties or interest during this period. This means taxpayers who have paid these penalties or interest may be entitled to a refund. However, the U.S. government has appealed the court’s decision, so refunds are not yet guaranteed. While the legal battle continues, tax experts strongly recommend filing a claim immediately to protect your rights.
Frost Law founder Glen Frost said time was of the essence for people considering making a claim. Tax experts say waiting for a final court ruling could cause people to miss legal filing deadlines. If someone misses the July 10 deadline, they could permanently lose their right to any future refunds, even if a court rules in favor of the taxpayer.
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who is qualified
People who delayed filing their tax returns during the COVID-19 emergency may be eligible. Taxpayers who miss estimated payments and are subject to penalties may also qualify. Even taxpayers who still owe penalties during this period may be eligible for relief, according to WCNC. Some people who file their international information returns late may also be eligible.
What a refund might cover
Refunds may include penalties for late filing of tax returns. Refunds may also cover penalties for late payment of taxes. Penalties for missing estimated taxes may also be refunded, according to Investopedia. Some interest charges collected by the IRS during the coronavirus pandemic may also be eligible for refunds or cancellations. Interest on overpayments associated with the COVID-19 disaster period may also be affected.
Other taxpayers who may benefit
State Taxpayer Advocate Erin Collins said the ruling affects more than just penalties and interest. Some taxpayers may still be able to claim refunds from previous years. This may include refunds related to withholding taxes. It may also include estimated tax payments. Refundable tax credits may also be affected.
Some taxpayers may still be able to receive recovery rebate credits. Other tax benefits over the years may also be available, depending on the court’s final decision, USA Today reported. People who never filed a tax return in those years may still have options, Collins said. She also said some taxpayers may benefit from filing an amended tax return to claim additional deductions or credits.
How to check if you are eligible
Experts recommend checking your Internal Revenue Service (IRS) COVID-19 tax records. Taxpayers should be aware of any penalties, late fees or interest charged during this period. IRS Account Transcripts can be accessed through your IRS online account. People can also call the IRS to request tax records.
How to archive
Taxpayers must file Form 843, called Refund Claim and Relief Request. Qualified individuals with an IRS online account can now file Form 843 electronically using a new IRS tool. People filing by mail should send the form to the IRS service center where they normally file their return.
Taxpayer advocate Erin Collins recommends filing as soon as possible because the deadline is so close. Collins said filing a protective claim could preserve taxpayers’ rights to refunds while the legal case continues, USA Today reported. She also warned that filing a claim does not guarantee a refund because the court case is pending.
What does the government say?
The Trump administration believes the Kwong court ruling was wrong. As WCNC noted, Treasury Department official Ken Kies said the government will continue to defend the current tax law during the appeal.
What tax experts say
Frost Law director Alyssa Maloof Whatley said taxpayers should still submit applications as court rulings could be upheld or overturned. She said that, as WCNC has argued, filing now protects taxpayers’ rights to receive funds if the court ultimately decides in their favor. Ellin & Tucker tax expert Travis Klein also advises taxpayers to file protective claims before the deadline.
why this is important
State taxpayer advocates say many of the affected taxpayers have low or moderate incomes. She warned that, as WCNC noted, many people may not understand this complex legal issue and may miss out on the refunds they deserve.
While the courts have yet to make a final decision, tax experts say filing a protective claim before July 10 is the safest way to preserve your rights to a potential refund. If the ruling is ultimately upheld, missing the deadline could permanently prevent eligible taxpayers from recovering their funds.
