Monday, July 26, 2010

Unclaimed IRS Tax Refunds

Last week my team posted a handful of articles to the learning center, including this informative article on unclaimed IRS tax refunds, and unfilled tax returns. As the article explains, the average undeliverable refund check in 2009 was $1,148, and although there are various reasons these refunds go unclaimed the most common cause is an unfilled return.

Each year, it is estimated that hundreds to thousands of individuals fail to file tax returns which would otherwise result in a refund. Unclaimed tax refunds often result as a busy taxpayer who is expecting a tax refund puts off sending in the tax forms until it is completely forgotten. As of March 2010, there is about $1.3 billion is sitting in Internal Revenue Service coffers, lost by the more than a million taxpayers who neglected to file a 2005 tax return by April 15, 2009.

The deadline for claiming a refund for 2006 was April 15, 2010. All unpaid refunds for 2006 were handed over to the U.S. Treasury.

Each year, some people don’t file a return because they don’t owe taxes. But knowing that you will not owe taxes for a given year should not prevent you filing a tax return, because you may still be eligible to receive a refund through various credits. The IRS doesn’t send refunds until it gets a Form 1040 (or 1040A or 1040EZ) that details just how big the government’s check should be. So, even if you will not owe taxes, filing a return may be in your best interest.

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