The IRS owes some taxpayers refunds after they were mistakenly left out of a pandemic-era IRS relief program, according to a new watchdog audit.
More than 2,100 taxpayers have had their tax accounts corrected after auditors found they were collectively eligible for an estimated $463,000, according to a recently released report from the Treasury Inspector General for Tax Administration.
TIGTA’s audit found that 2,138 taxpayers, representing 2,248 tax accounts, should have been eligible for relief from so-called failure-to-pay penalties related to unpaid taxes for 2020 and 2021. The average penalty refund owed per account was $206, the watchdog said, although the exact amount depended on the specifics of the taxpayer’s situation.
The IRS has credited the overlooked taxpayers’ accounts by the amount owed to them, according to the report. Those adjustments generally either reduce any balance owed or may be refunded via a check or direct deposit if there’s no balance.
Nearly 5 million individuals, businesses, trusts, estates, and tax-exempt organizations already received about $1 billion in penalty relief under the temporary failure-to-pay waiver by the IRS. The relief period, announced by the IRS in December 2023, began on the date that the agency issued an initial balance-due notice to a taxpayer, or Feb. 5, 2022, whichever was later, and ended on March 31, 2024.
