Millions of Americans were hit with IRS penalties during the COVID-19 pandemic. Now, the federal government may owe them money back. But there is a hard deadline approaching: July 10, 2026. Miss it, and the refund disappears permanently.
That warning comes from National Taxpayer Advocate Erin M. Collins, the independent watchdog inside the IRS. In an April 2026 blog post, Collins wrote that “tens of millions of taxpayers may be eligible for significant tax refunds” tied to penalties assessed during the pandemic. However, that figure likely includes taxpayers who already received automatic relief through a 2022 IRS initiative (described below), meaning the number who still need to act may be smaller. Regardless, the relief for those who remain eligible is not automatic. The IRS will not send you a check. You have to request it yourself, on paper, before the clock runs out.
To put the potential stakes in perspective: the failure-to-file penalty alone can reach 25% of unpaid tax and compounds monthly. A taxpayer who owed $6,000 and was assessed the maximum failure-to-file penalty could be looking at a refund of $1,500 or more, plus any interest that accrued on the amount.
Where these refunds come from
When COVID-19 was declared a national disaster in early 2020, the IRS postponed filing and payment deadlines under federal disaster relief authority. FEMA later closed all COVID-19 disaster declarations effective May 11, 2023, which started a statutory clock on how long taxpayers have to seek refunds or penalty abatements.
During those three-plus years, the IRS assessed an enormous volume of penalties, including failure-to-file and failure-to-pay charges that piled up while people dealt with job losses, illness, and economic upheaval. Many taxpayers either did not know they qualified for extended deadlines or were penalized despite the disaster declarations being in effect.
Under federal disaster relief rules, taxpayers have a limited window after the close of a disaster period to claim certain types of relief. A simple three-year count from May 11, 2023, would land on May 11, 2026, but disaster relief provisions in the Internal Revenue Code can extend that window further. According to Collins’s office, the adjusted deadline for COVID-era penalty claims falls on July 10, 2026. Collins’s blog post identifies that date as the cutoff, though neither her office nor the IRS has published a detailed breakdown of the specific statutory provisions that produce it.
It is worth noting that the IRS already granted some automatic penalty relief through Notice 2022-36, which waived failure-to-file penalties for roughly 4.7 million taxpayers who submitted their 2019 and 2020 returns by September 30, 2022. If you received that automatic relief, you may not need to take further action. But many taxpayers fell outside that narrow window, and failure-to-pay penalties were not covered by the automatic waiver. Those taxpayers need to file a claim themselves.
How to file your claim
The process is straightforward, but it requires a paper form and some legwork. Here is what to do:
1. Check whether you were penalized. Log into your IRS online account at irs.gov or request an account transcript by calling 1-800-908-9946. Look for failure-to-file or failure-to-pay penalties assessed for tax years 2019 through 2022, the period most likely covered by the COVID disaster declarations.
2. Download and complete IRS Form 843. This is the official “Claim for Refund and Request for Abatement.” The IRS posts the form and its instructions on its Form 843 page. Have your penalty notices or account transcripts in front of you when you fill it out, because you will need to identify the specific penalties and tax periods involved.
3. Mail the form. As of June 2026, there is no online submission option for Form 843. Although the IRS has been expanding its digital tools in recent years, this particular request still requires a paper filing. Print, sign, and mail Form 843 to the IRS address listed in the form’s instructions (it varies by state). Send it by certified mail so you have proof it arrived before the deadline.
4. Consider getting help. If you used a tax professional for your original return, they can file Form 843 on your behalf with a valid power of attorney (IRS Form 2848). Free tax preparation programs like VITA (Volunteer Income Tax Assistance) may also be able to help.
5. Do not wait until the last week. Mail delays, incomplete forms, and processing backlogs can all cause problems. Filing in May or early June 2026 gives you a meaningful buffer.
If you already paid the penalty, you are requesting a refund. If the penalty is still unpaid or in collections, you are requesting an abatement, which removes the charge from your account. Both requests use the same form.
Who qualifies and who does not
Not every penalty assessed between 2020 and 2023 is eligible. The relief applies specifically to penalties connected to deadlines that were postponed under the COVID-19 disaster declarations. If your penalty was for something unrelated, such as an accuracy penalty for understating income, it likely does not qualify.
The IRS has not published a detailed breakdown separating eligible penalties from ineligible ones, which Collins has flagged as a systemic problem. If you are unsure whether your situation qualifies, the Taxpayer Advocate Service (1-877-777-4778) can help you sort it out.
Neither the IRS nor the National Taxpayer Advocate has released an aggregate estimate of how much money could flow back to taxpayers if all eligible claims were filed. Individual refunds will vary widely depending on the size of the original penalty and any interest that accumulated. But for taxpayers who were assessed steep failure-to-file charges on significant balances, the amounts could reach into the thousands.
Why most eligible taxpayers still do not know
As of June 2026, the IRS has not launched a large-scale campaign to notify affected taxpayers directly. Collins’s blog post remains the most prominent official warning. Many people who were penalized years ago have moved, changed tax preparers, or simply stopped paying attention to IRS communications.
The gap between the number of people potentially eligible and the number likely to file before the deadline is almost certainly large. Lower-income households, non-English speakers, and people without regular access to tax professionals face the highest risk of missing out. The paper-only filing requirement adds another barrier at a time when most tax interactions happen online.
There is also no public indication that the IRS plans to offer flexibility beyond July 10. The deadline is tied to statutory limitation periods under the Internal Revenue Code, which cannot be adjusted without an act of Congress.
What happens if the IRS gets flooded with claims
If claim volumes surge in the weeks before July 10, the IRS could face processing challenges. The agency has not said how it plans to handle a potential wave of Form 843 filings. Because Form 843 is a general-purpose tool used for many kinds of penalty relief, each submission requires IRS employees to match the taxpayer’s situation against a complex set of dates and disaster relief provisions. Inconsistent application of the rules is a real possibility.
That is why certified mail matters. If the IRS later disputes whether your claim arrived on time, a certified mail receipt is your proof. Consider keeping a copy of the completed form and all supporting documents for your records.
The core facts here are not in dispute. The disaster period closed, the claim window is expiring, the form must be mailed on paper, and the IRS is not going to do this for you. The only open question is how many eligible taxpayers will find out before July 10, and how many will lose money they are legally owed because a deadline they never heard of quietly passed them by.
