The IRS has announced that the agency will be sending out refunds to over 400,000 taxpayers who are eligible for relief previously announced from the IRS related to estimated tax penalties in IRS News Release IR-2019-144.[1] The checks will be issued to taxpayers who were eligible for relief the IRS announced on January 16 and March 22 but who either did not take advantage on that relief on their return or filed their return before the relief was announced and have not filed a claim for refund.

The IRS lowered the threshold for the application of the penalty for underpayment of estimated income taxes from its standard 90% of the current year’s tax to 80% of the tax being paid in via withholdings and estimated taxes.

The IRS announced that they will take the following steps to provide this relief:

Over the next few months, the IRS will mail copies of notices CP 21 granting this relief to affected taxpayers. Any eligible taxpayer who already paid the penalty will also receive a refund check about three weeks after their CP21 notice regardless if they requested penalty relief. The agency emphasized that eligible taxpayers who have already filed a 2018 return do not need to request penalty relief, contact the IRS or take any other action to receive this relief.[2]

For those that have not yet filed, the IRS has the following advice:

For those yet to file, the IRS urges every eligible taxpayer to claim the waiver on their return. This includes those with tax-filing extensions due to run out on Oct. 15, 2019. The quickest and easiest way is to file electronically and take advantage of the waiver computation built into their tax software package. Those who choose to file on paper can fill out Form 2210 and attach it to their 2018 return. See the instructions to Form 2210 for details.[3]

[1]https://www.irs.gov/newsroom/irs-automatically-waives-estimated-tax-penalty-for-eligible-2018-tax-filers, August 14, 2019, retrieved August 15, 2019

[2] Ibid

[3] Ibid