A significant deadline is approaching for millions of U.S. taxpayers who may be eligible for refunds or penalty abatements related to tax filings during the COVID-19 pandemic. The eligibility window stems from a ruling that could provide relief for those penalized for late payments or filings during a specific disaster declaration period.
Individuals and entities that were charged penalties for not paying their taxes or for filing late tax returns during the disaster declaration period plus 60 days may qualify for refunds or abatements, provided the judicial decision is upheld. This also extends to those who incurred penalties for late filing of foreign information tax forms, such as those concerning international assets, gifts, or trusts.
Furthermore, taxpayers who were charged interest that began accruing during this period, or those who overpaid interest within that timeframe, may also be entitled to refunds. The scope of potential beneficiaries is broad, encompassing tens of millions of individual taxpayers, small businesses, large corporations, estates, and trusts.
To determine eligibility, taxpayers can access their federal income transcripts on the IRS website. These transcripts detail tax payments, penalties, and interest charges. Individuals and businesses can create an account using the IRS's ID.me service to view their transcripts online. Alternatively, transcripts can be requested by mail, but this method may result in a five to 10-day delay in delivery, potentially causing claimants to miss the filing deadline.