Nearly 1.6 million taxpayers will get $1.2 billion in late-filing fines refunded.

By The Exchange Team

Many Americans who filed late tax returns during the pandemic would not face penalties, the IRS said Wednesday.

Nearly 1.6m taxpayers will get $1.2b in penalty refunds or credits, according to the IRS. Many payments are due before September's end.

IRS Commissioner Chuck Rettig stated, "During the pandemic, the IRS worked hard to help the nation and bring relief to people."

The late filing penalty is 5% each month, capped at 25%. 0.5% monthly late payment penalty may still apply.

Individual, corporate, estate and trust returns are eligible, according to the IRS. But you must file return by Sept. 30 to qualify.

The IRS is under fire for a backlog of unprocessed tax returns, despite Rettig's pledges that it will be cleared by December.

Albert Campo, CPA and president of AJC Accounting Services in New Jersey, welcomed the relief.