New IRS Penalty Refund Opportunity
Taxpayers who paid IRS penalties or interest for 2020–2023 tax periods may want to review whether a protective Form 843 claim should be filed.
IRS COVID Penalty Refund Claims May Be Available
Recent IRS developments related to COVID-era postponement rules may allow certain taxpayers to file protective claims for penalties and interest assessed during affected tax periods.
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843
Claim for Refund and Request for Abatement
Protective Refund Claim
Who Should Look Into This?
IRS failure-to-pay penalties
IRS failure-to-file penalties
Estimated tax penalties
Interest related to penalties
Prior First Time Abatement usage
Penalties for 2020, 2021, 2022, or 2023
Later penalties where prior history may matter
Why This Can Be Complicated
Determining whether a claim makes sense requires reviewing IRS account transcripts, transaction codes, penalty dates, payment history, prior abatements, and whether First Time Abatement may have already been used.
| Issue | Why It Matters |
|---|---|
| IRS Account Transcript | Shows exact penalty and interest codes, assessment dates, and payment history. |
| Form 843 | Used to request a refund or abatement of penalties and/or interest. |
| First Time Abatement | Prior usage may affect future penalty relief and needs to be analyzed. |
| Estimated Tax Penalties | May require different analysis and documentation. |
| Interest | Not all interest is refundable. Each type must be reviewed. |
Our Process
Transcript Review
We review IRS account transcripts for the applicable tax years.
Penalty Analysis
We identify penalty type, amount, assessment date, and potential relief options.
Form 843 Preparation
We prepare year-specific Forms 843 with supporting statements.
Filing Strategy
We help determine how claims should be filed to preserve administrative rights.
What We Need to Review Your Situation
- IRS account transcript for each year
- IRS penalty notices, if available
- Copy of the tax years, if needed
- Any prior penalty abatement letters
- Payment history, if not clear from transcript
Prior First Time Abatement May Be Part of the Strategy
In some cases, a prior penalty may have been removed using IRS First Time Abatement. If that prior penalty is later determined to have been improperly assessed, there may be an argument that the taxpayer’s administrative penalty history should be corrected. This could matter for later years where First Time Abatement may otherwise be unavailable.
Frequently Asked Questions
Can everyone get a refund?
No. Each case depends on the tax year, penalty type, payment history, and IRS transcript.
Do I need IRS transcripts?
Yes. The transcript shows the exact IRS penalty codes and dates.
Does this apply to 2024 penalties?
Generally not directly, but prior penalty history may affect whether First Time Abatement is available for later years.
Can estimated tax penalties be refunded?
Possibly, but they require separate analysis and are generally less straightforward.
Is there a deadline?
Potential refund claims are time-sensitive, so taxpayers should review their transcript history as soon as possible.
Want to Know if Your IRS Penalties May Qualify?
Innovate Advisors can review your IRS transcripts and determine whether a Form 843 protective refund claim or penalty abatement request makes sense for your situation.