Charged IRS penalties or interest during the COVID-19 disaster period?
You may still have time to protect refund rights and potentially get your money back.
Two federal court rulings, Abdo v. Commissioner and Kwong v. United States , could impact taxpayers who were charged certain IRS penalties or underpayment interest between January 20, 2020 and July 10, 2023.
Hall Lundstedt helps taxpayers protect their refund claims.
Taxpayer-Friendly Federal Court Rulings
The courts in Abdo and Kwong, found that the federal COVID-19 disaster declaration may have automatically extended certain federal tax filing and payment deadlines. The rulings mean that the IRS may have lacked authority to assess certain penalties and interest during that time period - potentially creating refund opportunities for qualifying taxpayers. The IRS is currently appealing the ruling, and the outcome remains uncertain. However, taxpayers must act before applicable statutes of limitation expire in order to preserve potential claims.
WHO MAY QUALIFY
The rulings may affect taxpayers who, during the COVID-19 federal disaster period:
-
Filed a tax return late during the COVID-19 federal disaster period (January 20, 2020 - July 10, 2023).
-
Paid penalties (and interest charged on those penalties) for filing and paying late during that period.
-
Owed penalties and interest even if they remain unpaid.
-
Filed an international information return late.
​
Potentially affected taxpayers may include:
-
Business owners
-
Individuals
-
Nonprofits
-
Trusts and estates
-
Clients represented by CPAs or financial advisors
WHY ACT NOW
-
Even though the case is still under appeal, deadlines to preserve refund rights continue running.
-
For many taxpayers, filing a protective refund claim is not about immediate recovery — it’s about preserving options while the litigation process unfolds.
-
Waiting too long to evaluate eligibility could mean losing the ability to pursue a claim later if the ruling is upheld.
HOW Hall Lundstedt HELPS
Hall Lundstedt works with taxpayers and professional advisors to evaluate potential refund claim opportunities related to the Abdo & Kwong decisions.
Our process may include:
-
IRS transcript review
-
Penalty and interest analysis
-
Eligibility assessment
-
Protective refund claim preparation and filing
-
Handling of administrative appeals, if necessary
-
Coordination with CPAs and financial advisors
We focus on making complex tax controversy matters practical, understandable, and strategic.
Important Disclaimer
The IRS is actively appealing the Abdo & Kwong  rulings. Refund recovery is not guaranteed, and outcomes will depend on future litigation developments and individual taxpayer circumstances. Protective refund claims are intended to preserve potential rights while the legal process continues.