IRS Chief Tax Compliance Officer Jarod Koopman recently indicated that the IRS is considering creating a portal, in light of Kwong v. United States, 178 Fed. Cl. 295 (2025), to help taxpayers who may be entitled to refunds of COVID-era interest and penalties submit and track their refund claims. The announcement comes as the IRS continues to defend its interpretation of IRC §7508A(d) in the government’s appeal of the Kwong decision.
According to Koopman, the proposed portal would not be launched unless the government is ultimately unsuccessful in its appeal of Kwong, and refunds would not be processed until the litigation is resolved. While the announcement is a significant indication that the IRS is evaluating how it would administer potential refunds if the government does not prevail, taxpayers should not interpret it as eliminating the need to preserve their refund rights before the July 10, 2026, filing deadline.
In Kwong, the U.S. Court of Federal Claims held that IRC §7508A(d) automatically suspended certain tax-related deadlines during the COVID-19 disaster period, extending those deadlines through July 10, 2023. In reaching that conclusion, the court rejected the IRS’s longstanding interpretation that the statutory relief was significantly more limited.
If the decision is ultimately upheld, the implications could be substantial. Depending on a taxpayer’s particular facts, refunds or abatements may be available for:
Potentially affected taxpayers include individuals, closely held businesses, large corporations, estates and trusts.
The government has appealed the Court of Federal Claims’ decision, and that appeal remains pending. Until the appellate process concludes or the government otherwise changes its position, the legal issues presented in Kwong remain unresolved.
The possibility of a centralized IRS refund portal is certainly encouraging for taxpayers. It suggests the IRS is evaluating how it could efficiently administer refunds should the government’s appeal ultimately prove unsuccessful.
However, based on the information currently available, nothing indicates that the proposed portal would eliminate, extend or otherwise affect the statutory deadlines for filing administrative refund claims. Rather, it appears to be an administrative mechanism for receiving and tracking refund requests, not a substitute for satisfying existing procedural requirements necessary to preserve a taxpayer’s refund rights.
Accordingly, taxpayers who may have valid claims should not assume they can wait until the litigation concludes or until any future portal becomes available before taking action.
For many taxpayers, the deadline to file administrative refund claims for COVID-period interest and penalty payments is July 10, 2026. Missing that deadline could permanently bar a refund claim, even if the courts ultimately affirm Kwong or the IRS later establishes a streamlined refund process for administering refunds.
With that deadline now just around the corner, taxpayers who believe they may have paid COVID-era interest or penalties that could be affected by Kwong should contact a Withum tax professional as soon as possible.
For more information on this topic, please contact a member of our team.
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