Don’t suffer because of tax!

LASO’s Low Income Taxpayer Clinic serves Oregon taxpayers by helping them claim the cash benefits offered under the tax code in an effort to use the code to eliminate poverty across our state.

You may be due a refund and time is running out!

Tens of Millions of Taxpayers May Be Eligible for Significant Tax Refunds – If They Act on or before July 10

The Court of Federal Claims recently decided that all IRS tax deadlines during COVID (from January 20, 2020 through July 10, 2023) were automatically postponed. The refund window for COVID-era failure-to-file penalties, failure-to-pay penalties, estimated tax penalties, and underpayment interest closes on July 10, 2026.

The IRS has asked the Federal Circuit Court to reverse this decision.

  • If the Federal Circuit reverses Kwong, the protective claims drop out without harm.

  • If the Federal Circuit affirms, every claim filed by July 10, 2026 is in line for a refund, and every claim not filed by then is gone forever.

  • The downside of filing the protective claim is the cost of preparing it.

  • The downside of not filing is the entire refund.

    • Requires certain federal tax deadlines during a federally declared disaster to be extended through the length of the incident period, plus an additional 60 days.

    • COVID “incident period” was from January 20, 2020, to May 11, 2023.

      • Add the statutory 60 days, and the postponement period stretches to July 10, 2023.

    • Taxpayers have 3 years after the date a return is due to file and claim a refund.

    • That date is July 10, 2026

  • The practical implication is HUGE:

    If every federal tax deadline falling between January 20, 2020 and July 10, 2023 was automatically postponed to July 10, 2023, then a return filed any time before that date was not late, and a payment made any time before that date was not late either. Meaning, there should not have been any penalties or interest accruing.

    • Returns most likely affected are individual 1040s for tax years 2019 through 2022.

    • The Department of Justice has indicated it intends to appeal Kwong to the Federal Circuit.

    • The IRS has not started issuing refunds on its own and is unlikely to act on these claims while the appeal is pending.

    • Most claims will be either suspended or denied administratively.

      • A denial does not end the matter.

      • Under §6532(a), a taxpayer has two years from the date of the notice of disallowance to file suit in district court or the Court of Federal Claims.

      • Filing what is called a “protective filing” is what keeps that path open.

      • File now to preserve the position, and let the appeal play out without losing the right to a refund.

  • Below are the most common scenarios for taxpayer impacted by this decision. Click the option (coming soon) that is the closest to your issue. If none of the issues pertain to you, but you still have questions. Feel free to Contact Us. (keep in mind we will be very busy and it may take a while to hear from us.)

    • I had a tax return due during covid that I never filed and I think I was owed a refund.

    • I filed a tax return late or filed a tax return owing money during COVID and have paid interest and penalties or the IRS took a refund for another year to pay interest and penalties.

    • I filed a tax return late or filed a tax return owing money during COVID but I have not made any payments toward that debt and have not have any refunds taken by the IRS to pay that debt.

IRS News and Information

Every tax problem has a solution.

We help taxpayers find solutions free of charge.

Clinics like ours receive funding from the IRS. We work to ensure the fairness and integrity of the tax system for taxpayers who are low-income or for whom English is not the primary language spoken in the home.

LITCs are independent from the IRS and can help by providing:

  • Free legal representation in tax disputes with the IRS.

    • Our clinic can represent taxpayers in federal courts, as well as before the IRS.

  • Education and information about your rights and responsibilities as a taxpayer.

    • We offer educational presentation in Spanish and English and over 100 other languages through the use of interpretation services.

  • Our advocacy on issues that impact our client communities.