06/17/2026
You May Still Get Your 'Stimulus' After All
Ordinarily, a tax refund or credit must be claimed within three years of the original due date (including extensions) for the tax return for the respective year (or within two years of when the tax was paid, if later), otherwise, the refund or credit is permanently lost. For example, someone who did not receive the 2020 Economic Impact Payments, commonly called stimulus payments, would have had to file a 2020 tax return by no later than May 17, 2024 (assuming no extension), three years after the original filing deadline.
However, there are now several cases working their way through the court system, most notably Kwong v. United States, which argue that during the COVID-19 national disaster period and 60 days after – January 20, 2020 to July 10, 2023 – those usual time limits were suspended according to the law in effect at that time. If this argument is successful, that would mean that people have until this July 10 to file returns (or amend already-filed returns) and still receive refunds for tax years 2019 through 2022. They would also be able to file for and receive refunds of interest and penalties paid that were charged for late payment and filing during the suspension period (this may be done up to two years after payment was made, if that is later than this July 10). Abatement of interest and penalties assessed for the same time frame, but not yet paid, may be requested as well, although the same strict time limitation doesn't apply.
Rather than making a formal claim for refund, we recommend making what is known as a protective claim, which must be as detailed as possible and identify the specific issue the claim is contingent on – in this case the outcome of the Kwong litigation. The reason for this is that the IRS must approve or deny a formal claim within six months (long before the case will be resolved), and if denied the claimant has two years to appeal in federal court (by which time the Kwong case probably still won't be settled), after which time the IRS is permanently barred from issuing any refund, even if the claim later turns out to be valid; a protective claim, on the other hand, is generally put on hold by the IRS until the contingent issue has been resolved.
Of course the courts may ultimately rule against the arguments being made in the Kwong and similar cases entirely, or only allow certain exceptions to the general rule while rejecting others, however, what is almost certain is that most people who may potentially have refunds for 2019-2022 must act by this July 10 to protect them; at Holyoke Tax Service we are here to help you with the necessary filings to do that.
