The IRS released information in Notice 2022-36 that permits taxpayers to have the failure-to-file penalties removed from their returns for 2019 and 2020. This penalty relief (and subsequent refunds) will be automatic, according to the IRS.

Taxpayers do not need to request this penalty relief, and the IRS said it will pay most of the refunds or apply credits by the end of next month. However, any return still unfiled for the two tax years must be filed by Sept. 30, 2022, to be eligible for the relief. Keep in mind that the IRS does make errors and if you have had a penalty applied to either of these years make sure that your account is not one that is missed!

This relief applies to tax returns (including business/corporate returns), along with information returns such as Forms 1099. To be eligible, information returns for 2019 must have been filed on or before Aug. 3, 2020, and 2020 information returns by Aug. 2, 2021.

The relief measure is intended “to help struggling taxpayers affected by the COVID-19 pandemic” and to allow the Service to “focus its resources on processing backlogged tax returns and taxpayer correspondence to help return to normal operations for the 2023 filing season,” the IRS said in the release.