‘Major refund opportunity’: IRS may owe millions of Americans cash — but you must claim by July 10 to get your chance

‘Major refund opportunity’: IRS may owe millions of Americans cash — but you must claim by July 10 to get your chance Kevin Carter/ Getty Images Vishesh Raisinghani Wed, June 24, 2026 at 9:45 PM GMT+7 6 min read Moneywise and Yahoo Finance LLC may earn commission or revenue through links in the content below. Tax season was over months ago, but tens of millions of Americans could still be eligible for another tax refund this year. That’s because of a recent federal court ruling that opens a path for refunds or abatements of penalties and interest related to tax filing during the COVID-19 period. Dave Ramsey warns nearly 50% of Americans are making 1 big Social Security mistake — here’s how to fix it ASAP JP Morgan sees gold hitting $6,000/oz before 2027 — and a Gold IRA lets you hold the physical metal while deferring the tax bill. Get your free guide from Priority Gold The ultra-rich use these 5 real estate strategies to build wealth while they sleep — you can start with just $100 The situation was described as a “major refund opportunity” by the National Taxpayer Advocate (NTA), Erin Collins (1). However, there is one big catch — taxpayers must file their claim before July 10th. Here’s what you need to know about eligibility and the steps to take before time runs out. Under ordinary circumstances, missing a tax deadline can be costly. The Internal Revenue Service (IRS) applies both penalties and interest to late filings and payments. Specifically, the failure-to-file penalty (2) accumulates at 5% of unpaid taxes per month, whereas the failure-to-pay penalty (3) charges 0.5% monthly. Taken together, they are capped at a maximum of 25%. However, several recent court rulings, including Kwong v. United States (4), found that the IRS should not have assessed certain penalties and interest from Jan. 20, 2020, through July 10, 2023, according to CNBC (5). This period covers the duration of the official COVID-19 federal disaster period plus 60 days. Essentially, the court is suggesting that the official disaster period postponed filing deadlines for taxpayers, so the tax authorities shouldn’t have levied late-filing penalties, late-payment penalties, or interest on those penalties. That means any taxpayer who was charged these fees for that specific period may be eligible for a refund. To be clear, the court ruling isn’t final — the government can still appeal. Also, the refunds are not automatic. Eligible taxpayers are expected to file their claim on or before July 10, 2026. That’s a tight deadline. So, if you believe you’re owed a refund, you may want to move quickly. Read More: Thanks to Jeff Bezos, you can become a landlord for $100 — without the headache of actually being one First, pull your tax transcripts through your IRS online account and look for penalties or interest assessed between Jan. 20, 2020, and July 11, 2023. That tells you whether you have a claim worth filing, according to NTA. Second, file Form 843, Claim for Refund and Request for Abatement. If you already paid the penalties and interest, you are asking for a refund. If you were charged but have not paid, you request an abatement. There is a practical hurdle: Form 843 cannot be filed electronically, according to Collins. You must file your claim by traditional physical mail, and preferably certified mail, so you can prove it arrived on time. This could be a stressful and complicated process, so you may want to consider working with an expert financial advisor to make sure you’ve assessed this period correctly. Platforms like Advisor.com can help connect you with a local expert quickly, so you can move on this refund claim before the deadline. Advisor’s network includes fiduciaries, who are legally obligated to work in your best interest. They can also help with more general tax filing information, or preparing for retirement — not just a 843 submission. Even better, the platform lets you set up a free initial consultation, with no obligation to hire, to see if they’re the right fit for you. Once you get your refund, you can think about ways to use that cash to cement your financial security. Every unexpected tax refund or windfall is another chance to boost your financial security. Since this money falls outside your regular budget, you could invest it in robust assets that deliver long-term growth. The easiest way to do this is by investing regularly in the stock market, with a special eye for your risk tolerance and investment horizon. Platforms like Robinhood are designed to make investing simpler and more approachable. If you prefer a more hands-on approach, you can also buy and sell individual stocks, fractional shares and options (for qualified traders) — backed by 24/7 support. Stocks, ETFs and their options trades are commission-free. With access to popular ETFs like the Vanguard S&P 500, you can build diversified exposure without needing to pick individual stocks. The platform also offers both a traditional

‘Major refund opportunity’: IRS may owe millions of Americans cash — but you must claim by July 10 to get your chance

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