IRS Extends Certain Lookback Periods For COVID & Hurricane Extended Returns

According to Law360, the IRS said it will disregard a period in 2020 and another in 2021 between April 15 of each year and the date of postponed tax filing deadlines for determining the start of lookback periods for some tax refund or credit determinations.

The Internal Revenue Service said in Notice 2023-21 that while Notices 2020-23 and 2021-21 postponed certain filing due dates, postponements and extensions aren't the same thing. The postponements didn't lengthen the lookback periods under Internal Revenue Code Section 6511(b)(2)(A ), the IRS said.

According to the agency's notice, under Section 6511(a) , taxpayers must file refund or credit claims within three years of filing returns or two years after paying the tax, whichever comes later. Section 6511(b)(2) limits credit or refund amounts to amounts of tax paid within a specific period immediately before the filing of refund or credit claims, the lookback period, according to the notice. For taxpayers filing claims within three years of filing returns, lookback periods are three years plus the periods of filing extensions, and otherwise they're two years, the IRS said.

The notice allows taxpayers who had return filing due dates postponed by Notices 2020-23 and 2021-21 but didn't get extensions and who timely file credit or refund claims to be credited or refunded amounts paid on April 15 of each year, according to Notice 2023-21.

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