A little-known court ruling could put money back in your pocket — but only if you act before July 10, 2026. If you paid IRS penalties or interest during the pandemic years, here is why you may be owed a refund and what to do about it now.
The Ruling: A COVID-Era Law May Have Extended Key Deadlines
During the pandemic, Congress passed relief legislation that, among other things, paused certain timelines. The Court of Federal Claims has indicated that one of these provisions may have effectively extended important tax filing and payment deadlines — potentially through July 11, 2023.
If that interpretation holds up, taxpayers who were assessed penalties or interest based on the old deadlines may have been charged for being “late” when, under the extended timeline, they were not late at all.
Who Was Affected
This potentially reaches a wide group of taxpayers, including those who:
- Paid late-filing or late-payment penalties during the pandemic period
- Were charged interest tied to those deadlines
- Filed or paid close to a deadline that may now be considered extended
If any of that sounds like your situation, it is worth a closer look at your transcripts and notices from those years.
What a “Protective Refund Claim” Is
The case is still working its way through the appeals process, which means the law is not yet settled. That creates a timing problem: the deadline to claim a refund could pass before the courts finish.
A protective refund claim solves this. It is a claim you file now to preserve your right to a refund while the legal question is decided. If the courts ultimately rule in taxpayers’ favor, your claim is already in line. If you wait and the deadline passes, you lose the right entirely — even if you would have won.
The July 10, 2026 Deadline
To protect potential refund rights tied to this issue, the practical deadline to file a protective claim is July 10, 2026. After that date, the window to preserve these claims is expected to close while the appeal continues.
How to File and What to Include
A protective claim generally identifies the tax year, the amount at issue, and the legal basis for the refund — here, the extended-deadline argument. Because the claim must be specific enough to be valid but is filed before the law is final, the wording matters. This is an area where professional help pays for itself.
The Math Is Simple
Filing a protective claim costs relatively little. Missing the deadline could cost you the entire refund. When the downside of acting is small and the downside of waiting is permanent, the decision is easy.
Manay CPA can review your pandemic-era penalties and file a protective claim before July 10, 2026. Request a free penalty & refund review →
This article is for general informational purposes only and is not tax or legal advice. Your eligibility depends on your specific facts. Consult a qualified tax professional before acting.
