Small Firm, Big Win: How Kellogg and Kellogg, PC preserved the opportunity to recover $100K+ for Clients in Weeks
Quick answer: When federal court rulings invalidated COVID-era IRS penalties, creating a narrow window for businesses to file protective refund claims before the July 10 deadline, Kellogg and Kellogg, PC identified the opportunity, launched a proactive client outreach campaign, and successfully filed claims for all 30–40 eligible clients— preserving the opportunity to recover over $100,000 in refunds at no additional cost to clients facing the time crunch.
Summer is typically a season for slowing down. Inboxes thin out. Decisions get deferred. But for the team at Kellogg and Kellogg, PC, the months between May and July 2025 were anything but quiet.
When federal court rulings—most notably Kwong v. United States—invalidated IRS penalties assessed during the COVID years, a narrow legal window emerged. To preserve their rights, businesses had to take deliberate legal action: filing protective refund claims before a hard deadline of July 10, and doing so over active IRS objections. This was not a program the IRS announced or encouraged. It was a right taxpayers had to assert on their own initiative, or risk losing it entirely.
Most organizations had no idea this window existed. The legal basis was technical. The timeline was compressed and the stakes were real: qualifying businesses stood to recover meaningful sums on penalties that courts had found to be invalid.
Kellogg and Kellogg, PC did not wait for clients to ask. The firm identified the opportunity, assessed eligibility across its client base, and launched an immediate, structured outreach effort— preserving the opportunity to recover over $100,000 in combined refunds for 30 to 40 eligible clients before the deadline closed.
This is not a story about luck. It is a story about infrastructure, accountability, and what it actually means to have a CPA firm that monitors the tax landscape on your behalf.
What Was the COVID-Era Tax Penalty Refund Opportunity?
During the COVID-19 pandemic, the IRS assessed penalties and interest against many businesses under circumstances that were, to put it plainly, extraordinary. Economic shutdowns, staffing shortfalls, supply chain failures, and cash flow disruptions made timely compliance extremely difficult for organizations that were otherwise operating in good faith.
Federal courts ultimately ruled that some of these penalty assessments were legally invalid. In Kwong v. United States and related rulings, courts found that the IRS had overstepped in applying penalties during the official COVID-19 disaster period—defined as January 20, 2020, through July 10, 2023. Critically, the IRS did not concede these rulings or proactively offer relief. Taxpayers had to file protective refund claims over IRS objections to lock in their rights to recovery.
That distinction matters. This was not a government-sponsored relief program. It was a legal right that existed only for those who took affirmative steps to assert it—and only for those who did so before the July 10 deadline.
From identification to submission, Kellogg and Kellogg, PC had a matter of weeks to act.
How Kellogg and Kellogg, PC Responded
Monitoring the Tax Landscape in Real Time
The opportunity was not publicized by the IRS. Identifying it required active monitoring of federal court decisions, regulatory developments, and evolving legal guidance—the kind of ongoing surveillance that a dedicated CPA team performs as a matter of course, but that does not always translate into client action without the right infrastructure.
At Kellogg and Kellogg, PC, identifying the legal window was only the first step. The more important question was: which clients are eligible, and how quickly can the firm move?
Proactive Client Outreach—Without Being Asked
Rather than waiting for clients to inquire, the team conducted a systematic review of the client base, cross-referencing filing histories and penalty records against the qualifying criteria established by the court rulings. Eligible clients were contacted directly and walked through the legal basis for their claims, the compressed timeline, and the submission process.
This outreach extended beyond active clients. Kellogg and Kellogg, PC also reached out to former clients who fell within the qualifying scope—because the obligation to act in a client's interest is not contingent on whether that client is currently on retainer.
Thirty to forty clients were identified as eligible. All of them had protective refund claims filed before the July 10 deadline.
Fee Structure: Doing Right by Clients Under a Tight Deadline
Kellogg and Kellogg, PC made a deliberate decision regarding fees: for clients navigating this compressed timeline, the additional work required to prepare and submit protective claims was not billed at an incremental rate. The firm absorbed the administrative burden because placing a transactional cost on an urgent client benefit did not align with the firm's values.
Fee arrangements in refund-related engagements are subject to professional standards. Percentage-based fees tied to refund amounts are not appropriate in this context, and Kellogg and Kellogg, PC structured its approach accordingly—with transparency and professional integrity as the guiding principles.
What This Case Study Reveals About Firm Size and Agility
There is a common assumption in professional services that larger means better. Larger firms have more resources, deeper benches, and broader geographic reach. For certain engagements—complex multinational tax structures, large-scale audits, capital markets transactions—that scale matters.
But scale also creates distance. Decision-making is layered. Client relationships are distributed across teams. Monitoring and response mechanisms may be thorough, but the chain between identifying an opportunity and acting on it for a specific client involves more steps.
At Kellogg and Kellogg, PC, the distance between insight and action is short by design. John Kellogg and the firm's leadership team maintain direct involvement with client accounts. When a time-sensitive legal development is identified, there is no internal approval hierarchy standing between the firm and the client. The team moves.
This is not a criticism of larger firms. It is an honest description of a structural difference—and an invitation for businesses to evaluate which model better serves their actual needs.
What Questions Should You Be Asking Your Current CPA Firm?
If your organization has a CPA relationship in place, the COVID-era penalty refund situation is worth examining from a practical standpoint:
Was your firm aware of the court rulings that invalidated these penalties? If so, did they contact you proactively, or did they wait for you to ask?
Were your COVID-era penalty assessments reviewed for potential refund eligibility under Kwong v. United States and related decisions? If the deadline passed without any outreach, that is meaningful information about how your firm monitors legal and regulatory developments on your behalf.
Does your firm have the systems to identify time-sensitive legal opportunities across your account? Proactive monitoring is not a feature—it is a standard of service that every business deserves.
If the answer to any of these questions gives you pause, that is worth taking seriously. Legal windows tied to court rulings operate on fixed timelines. Missed deadlines do not reopen.
The Case for Reevaluating Your CPA Relationship
Kellogg and Kellogg, PC serves medium-sized businesses across a range of industries, including construction, manufacturing, distribution, trade associations, and nonprofits. The firm has been doing so for over 25 years. Proudly described as "the biggest small firm in Fort Worth," Kellogg and Kellogg, PC combines the technical capabilities and comprehensive service offerings of a larger practice with direct executive access and relational depth of a boutique firm.
The services span financial statement audits, reviews and compilations, tax return preparation and compliance, tax planning and advisory services, and strategic forecasting and consulting. For organizations with 401(k) plans subject to Department of Labor audit requirements, Kellogg and Kellogg, PC provides specialized plan audit services for limited scope employee benefit plans.
Technology is integrated throughout. Advanced tools including OCR, AI-driven automation, Caseware, Datasnipper, SurePrep, Canopy, and UltraTax support accuracy, efficiency, and thorough documentation—without ever replacing the human judgment that makes those tools useful.
What the COVID-era refund case demonstrates is something that cannot be built into software: the organizational will to act on a client's behalf, without prompting, under time pressure, at no incremental cost.
What Agility Actually Looks Like in Practice
The word "agility" is used freely in professional services marketing. It tends to appear alongside phrases like "nimble" and "responsive" without much evidence. The COVID-era tax penalty refund engagement is evidence.
Kellogg and Kellogg, PC tracked federal court rulings that invalidated COVID-era IRS penalties, assessed 30 to 40 clients for eligibility under the qualifying disaster period of January 20, 2020 through July 10, 2023, conducted direct and proactive outreach—including to former clients—and filed all protective refund claims before the July 10 deadline, preserving the opportunity to recover over $100,000 in combined refunds. The firm did this over IRS objections, structured the engagement consistent with professional standards, and placed the client's interest at the center of every decision.
That is agility. Not as a marketing claim. As a documented outcome.
Is Your Organization Getting the Proactive Representation It Deserves?
Every business deserves a CPA firm that treats regulatory and legal monitoring as a core responsibility—not as a service to be triggered only when the client asks. The COVID-era penalty refund situation is one example. There will be others: court decisions, legislative changes, IRS guidance updates, state-specific tax considerations, and compliance deadlines that carry real financial consequences.
The question is whether your current firm is positioned to identify those developments and act on them decisively—even when doing so requires pushing back against an agency that would prefer inaction.
If you are reassessing that question, Kellogg and Kellogg, PC welcomes the conversation. The firm brings 25 years of expertise, direct leadership involvement, and a demonstrated record of acting in clients' interests when it matters most.
Contact Kellogg and Kellogg, PC to discuss your organization's tax and financial reporting needs.
Frequently Asked Questions
What was the legal basis for the COVID-era tax penalty refund claims?
Federal court rulings, including Kwong v. United States, found that certain IRS penalties assessed during the official COVID-19 disaster period were legally invalid. The disaster period ran from January 20, 2020, through July 10, 2023. Because the IRS did not proactively offer relief, taxpayers were required to file protective refund claims over IRS objections to preserve their legal rights. The deadline for doing so was July 10.
Did the IRS sponsor or announce this refund opportunity?
No. The IRS actively opposed these claims. The refund opportunity arose from federal court rulings that invalidated the underlying penalties. Businesses that recovered refunds did so by asserting their legal rights through protective filings—not by participating in an IRS-sponsored program.
How did Kellogg and Kellogg, PC identify this opportunity for clients?
Kellogg and Kellogg, PC actively monitors federal court decisions, IRS communications, and regulatory developments as part of its standard service model. When the legal basis for protective refund claims was identified following the relevant court rulings, the firm reviewed its client base for eligibility and initiated direct outreach—without waiting for clients to inquire.
How many clients did Kellogg and Kellogg, PC help recover refunds?
Between 30 and 40 clients were identified as eligible. The firm filed protective claims for all eligible clients before the July 10 deadline, preserving the opportunity to recoverover $100,000 in combined refunds.
Were clients charged additional fees for this engagement?
Kellogg and Kellogg, PC made the decision not to bill clients incrementally for the work required to prepare and file protective refund claims during this compressed timeline. The firm does not structure refund engagements on a percentage basis, as this is inconsistent with professional standards.
Does Kellogg and Kellogg, PC work with former clients on time-sensitive tax matters?
Yes. The firm extended outreach to former clients who fell within the eligible scope of the COVID-era refund claims. Client history and relationship inform the firm's obligations—not only its current retainer status.
What types of businesses does Kellogg and Kellogg, PC serve?
Kellogg and Kellogg, PC serves medium-sized businesses across a range of industries, including construction, manufacturing, distribution, trade associations, and nonprofits. The firm provides financial statement audits, tax preparation and compliance, tax planning and advisory services, 401(k) plan audits, and strategic forecasting and consulting.
How is Kellogg and Kellogg, PC different from larger CPA firms?
Kellogg and Kellogg, PC offers direct access to firm leadership, a shorter decision-making chain, and a relational model that supports proactive client engagement. While larger firms provide advantages in scale for certain complex engagements, Kellogg and Kellogg, PC delivers the technical depth of a large firm with the responsiveness and accountability of a boutique practice.
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