The IRS Might Owe You Money, But You Have to Ask by July 10

I was trying to mind my business, and then I ran across something that made me sit up a little bit.

Because you mean to tell me the IRS may have charged millions of people penalties during a whole pandemic, kept the money, and now there is a court case saying some of that may not have been handled right?

Are they serious?

During COVID, people were losing jobs, getting sick, burying family members, shutting down businesses, trying to homeschool kids, trying to keep food in the house, and just trying to make it from one week to the next.

Meanwhile, the IRS was still over there charging late filing penalties, late payment penalties, estimated tax penalties, and interest like the world was not literally on fire.

How are we in a federal disaster, but the penalty machine is still running like it’s business as usual?

That is where this Kwong v. United States case comes in.

The way this is being discussed, the argument is that because the whole country was under a federal disaster declaration, certain tax deadlines should have been automatically pushed back. If that is right, then some of the penalties and interest the IRS charged between January 20, 2020 and July 10, 2023 may not have been valid.

And when I say this could affect a lot of people, I mean a lot.

This is not one of those little tax updates that only matters to three corporations, two attorneys, and somebody’s trust fund.

This could matter to people who filed late during COVID. People who paid late. People who got IRS notices. People who paid penalties just to get the IRS off their back. People who still have those penalties sitting on their account right now.

And no, before anybody gets too excited, this does not mean everybody is automatically getting a check.

Because why would they make it that easy?

You may have to ask for it.

If the IRS charged you penalties or interest between January 20, 2020 and July 10, 2023, this is worth looking into.

That could be late filing penalties.

Late payment penalties.

Estimated tax penalties.

Interest tied to those penalties.

Or a mix of all of it, because you know how the IRS likes to stack things.

This could apply to individuals, self-employed people, small business owners, estates, trusts, and anybody else who had a federal tax situation during that time and got hit with extra charges.

If you paid those penalties already, you may be looking at a possible refund claim.

If you still owe them, you may be looking at a possible abatement request.

That means asking the IRS to remove the penalty from your account.

Either way, the main point is this…

Do not assume the IRS was right just because the notice had their letterhead on it.

Find the notice.

Pull the transcript.

Ask questions.

The form is called Form 843.

The official name is Claim for Refund and Request for Abatement.

And no, most people have not heard of it, because of course the form that helps you ask for money back is not exactly being advertised like a new iPhone.

Form 843 is what you use when you are asking the IRS to refund certain penalties, interest, or fees, or remove charges from your account.

For this situation, people are being told to write something like this across the top:

Protective Refund Claim Pursuant to Kwong Case

That sounds very legal and annoying, but the point is simple.

You are basically saying, “I am putting my claim in now before the deadline closes, even if all the final details are still being worked out.”

Because this is still tied to a court case. Things may shift. The IRS may fight it. The final outcome may take time.

But if you wait too long, you may not even be in the conversation anymore.

And that part should make everybody move a little faster.

The date being talked about is July 10, 2026.

Not “later.”

Not “whenever I get around to it.”

July 10, 2026.

And if you have ever dealt with the IRS, you already know they can take forever when they owe you something, but let you miss one deadline and suddenly everybody knows how to read a calendar.

So no, do not wait until the last minute.

If you think this might apply to you, start looking now.

Get your IRS notices.

Check your transcripts.

Talk to somebody who knows what they are looking at.

And if you file Form 843, mail it certified with return receipt so you have proof.

Because we are not doing “I think they got it” with the IRS.

No ma’am.

This is one of the parts that can make people freeze.

You might be thinking, “I do not even know how much the IRS charged me. How am I supposed to file something?”

That is where the protective claim part matters.

You may not have the exact number yet. The legal issue may not be fully settled. But filing a protective claim can help protect your right to ask for the refund later if things go in favor of taxpayers.

So do not let not knowing every detail make you do nothing.

That is how people miss money.

And I do not like that.

If this sounds confusing, that is because it is.

Tax stuff will have you reading one paragraph six times and still wondering who raised these people.

So get help if you need it.

A tax professional can help you look at your transcript and figure out whether penalties or interest were charged during that window.

If you cannot afford paid help, look for a Low Income Taxpayer Clinic in your state. These clinics help people with IRS problems, and many offer free or low-cost assistance if you qualify.

And this is exactly the kind of situation where help might matter, especially if you have multiple years involved, old IRS notices, unpaid balances, or a transcript that looks like somebody sneezed numbers all over the page.

Because this is exactly the kind of thing that gets buried in tax blogs and court updates while the IRS keeps the money and everybody else keeps it moving.

The tax attorneys know.

The big businesses know.

The people with accountants watching court cases know.

But the person who got an IRS notice during COVID, panicked, paid the penalty, and kept going?

They may not know anything about this.

And that is the problem.

I have prepared tax returns. I have dealt with people who were scared, confused, and frustrated because they had an IRS notice in their hand and no idea what it really meant.

So when I see something that could possibly put money back in somebody’s pocket or get a penalty removed from their account, I am going to say something.

Because if the IRS collected money they may not have been supposed to collect, the people who paid it deserve to know there may be a way to ask for it back.

Not a guarantee.

Not a promise.

But a reason to check.

Here is what I would do if I thought this might apply to me.

Because if there is even a chance the IRS owes you money, I do not want you finding out after the window closes.

That would irritate me.

And honestly, it should irritate you too.

Just keep that in mind.

Your AI Auntie said so.

Your AI Auntie breaks down tax moves, IRS deadlines, and money decisions for women building on their own terms. If this helped you, forward it to someone who needs it.

This post is for educational purposes only and is not tax advice for your specific situation. Please talk to a qualified tax professional about your own IRS account before filing anything.