It’s 2016: do you know where your refund is? No, not your 2015 refund, your 2012 refund. Nearly $1 billion in outstanding refunds remain unclaimed from 2012. That represents an estimated one million taxpayers who might have qualified for a refund but who did not file a federal income tax return for 2012.
How much is a billion dollars? I know we throw around these “illions” anymore (millions, billions, trillions) like they’re nothing but it’s a lot of money. How much? If the Internal Revenue Service (IRS) gave away a dollar an hour, it would take more than 114,155 years to get rid of $1 billion.
If you are due a refund, you must file a federal income tax return in order to get your money. You typically have a three year window following the return due date to claim your tax refund. To claim your refund for the 2012 tax year, your return must be postmarked on or before April 18, 2016 (or April 19, 2016, for taxpayers in Maine and Massachusetts). For more on due dates in 2016, click here.
If you need a copy of the 2012 form 1040 (downloads as a pdf), visit the IRS website or call toll-free 800-TAX-FORM (800-829-3676). Remember that you’ll need your forms W-2, 1098, 1099 or 5498 from 2012 in order to file. If you don’t have your old tax forms, you can request copies from your employer, bank or other payer; if that doesn’t work, you can try ordering them from IRS.gov using the “Get a Transcript by Mail” tool. You can also file a form 4506-T (downloads as a pdf) and use the information on the transcript to file a return.
“A surprising number of people across the country overlook claiming tax refunds each year. But the clock is ticking for taxpayers who didn’t file a 2012 federal income tax return, leaving nearly $1 billion in refunds unclaimed,” said IRS Commissioner John Koskinen. “We especially encourage students and others who didn’t earn much money to look into this situation because they may still be entitled to a refund. Don’t forget, there’s no penalty for filing a late return if you’re due a refund.” (emphasis added)
Of course, if you owe the feds money for student loans or back taxes, for example, or if your refund is otherwise earmarked for seizure, such as for child support obligations, any tax refund will be offset by the amounts owed (for more on offsets, click here). Additionally, if you are not compliant or if you have not filed tax returns for 2013 and 2014, the IRS may hold your tax refund.
If you don’t file for refund within the proper time frame, you lose your right to claim it altogether. It becomes the property of the U.S. Treasury.
Who is owed the most money? By the numbers, the top ten states by outstanding number of refunds are:
Those states are highlighted on the US map in red below.
The top ten states by median refund are:
Those states are highlighted on the US in green below.
To see where your state ranks, click on over to the IRS website.
And it gets even better: refund amounts could actually be even more than the estimates. The IRS estimates exclude the Earned Income Tax Credit and other credits.
Why might you be due a refund? Maybe you had too much withholding from your wages or made too much in quarterly payments. You might have also been eligible for the EITC. Even though you were due a refund, you might not have filed because you had too little income to require filing a tax return and you thought it wouldn’t make a difference. But that’s not always the case. Remember, you can’t receive the benefit of refundable credits – or other tax breaks which might result in a refund – unless you file.
source: forbes.com by Kelly Phillips Erb