A recent opinion in the ongoing litigation in the case of Clair R. Couturier makes a really important point about the distinction between a penalty and a tax. We will get to that, but I would also like to discuss the larger story of the case as I struggle with what the lesson is. I thought this case might be a good illustration of Reilly’s Second Law of Tax Planning – Sometimes it’s better to just pay the taxes – but I’m not 100 percent sure, so I will let you be the judge.
Kwong v. United States: A Pandemic-Era Decision That Could Reshape Tax Deadlines, Penalties, and Refund Opportunities
Dominique Molina, CPA MST CTS
The 2025 court decision, Kwong v. United States, is quietly gaining traction among tax professionals for exactly these reasons. Its implications could be far-reaching, potentially opening the door to refund claims, penalty abatements, and revived tax deadlines that many assumed were long closed. But there’s a catch: the opportunity to act may be time-sensitive, and the window to preserve claims could begin closing in just a few short weeks. Here’s what the court actually decided and why it matters now.
