People Are Collecting Tax Refunds From COVID Thanks to a New Ruling-Here's How You Can Get In On It
Hearing the name IRS can be stressful for many people. That's because the agency is responsible for ensuring that Americans make their tax payments on time, often levying hefty penalties, interest, and other penalties when they fail to do so.
However, a new court ruling may have the IRS checking its pockets for spare change, after it was determined that many people should not have been charged interest and penalties during the height of COVID. Keep reading to find out if you're owed money.
The IRS May Owe Certain Taxpayers Money
According to an IRS blog, tens of millions of Americans could be owed a big payout from the IRS after a court decided that the federal disaster that was established during the COVID-19 crisis should've prevented the IRS from collecting certain payments.
Taxpayers will need to advocate for themselves to receive the payment, according to the Taxpayer Advocate Service, which says they must file a request before July 10, 2026.
Related: The Best Strategies To Protect Your Social Security From the IRS
This is all happening due to a Nov. 2025 court ruling that found that filing and payment deadlines shouldn't have been enforced from Jan. 20, 2020, through May 11, 2023. Instead, the court argues that payments weren't considered late until after July 10, 2023, meaning any late fees, interest, or penalties assessed on payments made before then shouldn't have been collected until after the extension period, which would've come 60 days after the disaster declaration was lifted.
"The plain meaning of that statute is that the automatic extension runs from the beginning of the disaster declaration, through the end of the declared disaster period, and until 60 days after the end of the declared disaster period," the ruling said.
How to Find Out if the IRS Owes You Money
Wondering if this means you'll be eligible to get a little money back from the IRS? According to Today.com, payments made for the following reasons should qualify you for a rebate:
- "Overpayment interest for the 2020–2023 disaster period"
- "Interest that began accruing earlier than it should have, or not at all."
- "Penalties for failure to timely file returns, failure to pay taxes, or failure to make estimated tax payments"
Everyone, from individual filers to corporations, may be owed money under this new ruling, making it especially important for people to do additional research to see if they can get a refund.
How to Get a Refund Under the New Ruling
The IRS won't automatically go back through its records and issue checks for the money that is owed. Instead, Today.com says that people will have to do the legwork themselves and file Form 843, which can be found on the IRS website.
However, it's worth noting that the Taxpayer Advocate website says many people will need to educate themselves about this refund to fully understand whether they qualify, and may benefit from hiring a professional to help them navigate the system and determine just how much they could be owed.
As many people already know, tax law is very confusing and constantly changing, which can make it hard to understand whether or not you can collect as part of this new ruling.
Disclaimer: This article is for informational purposes only and does not constitute financial advice.
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This story was originally published May 4, 2026 at 2:25 PM.