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The national taxpayer advocate, an independent watchdog of the IRS, is warning that the deadline to apply for relief is fast approaching after a federal court late last year ruled that taxpayers were not required to file their taxes on time during COVID-19.

The IRS had assessed more than 120 million penalties against tens of millions of taxpayers for filing late returns, failing to pay taxes or failing to make required estimated tax payments between January 2020 and July 11, 2023.

The case, called Kwong v. U.S., decided that COVID-19 emergency laws extended the deadline to file and that the IRS owes penalty payments to taxpayers. The case is still being litigated.

The taxpayer advocate calls the issue “widespread and not limited to a small or specialized group of taxpayers."

Ken Kies, assistant secretary at , told The Associated Press that President Donald Trump's Republican administration believes that Kwong “was wrongly decided because it is a misreading of the plain language of the statute.”

“We will continue to defend the statutory language as written,” he said in a statement.

Still, as it currently stands, taxpayers should fill out a form to preserve their rights, said Alyssa Maloof Whatley, a director at Frost Law, a tax firm with locations across the U.S.

“Either it holds up or it doesn’t,” she noted of the ruling. ”So by preserving your claim, you’re actually preserving your right to that money.”

How to apply

People eligible for a potential refund or abatement are those who filed a tax return late between Jan. 20, 2020, and July 11, 2023; paid penalties for filing or paying late during that period; owed IRS penalties even if they have not paid them; or filed an international information return late.

In a series of blog posts on its website, the taxpayer advocate is sharing recommendations — including that people review their IRS tax account transcripts through their online account — to check penalty assessments from those periods.

Who's affected

“Many taxpayers affected by this issue have low and moderate incomes,” the taxpayer advocate said. “These taxpayers are less likely to have professional representation and to learn about complex legal developments like this one. As a result, they face a greater risk of missing the opportunity to claim refunds to which they may be entitled.”

Maloof Whatley said people will need to fill out , which can be found on the IRS website, and send it through snail mail.

According to the IRS, for people who received a penalty during the pandemic, the form must be mailed to the service center where they would be required to file a current year tax return.

Because of the impending July 10 deadline, “taxpayers should not delay reviewing their situation and considering potential claims for refund and abatement,” the taxpayer advocate said.

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