Your last shot at a check for the 2002 tax year disappears April 17, 2006. The IRS says half who didn't file are owed money -- and there's no penalty for filing to claim it now.
By MSN Money Staff
Perhaps billions of dollars are sitting in the Internal Revenue Service account just waiting to be claimed by the rightful owners. But time is running out.
Every year, the IRS puts out an alert for people who haven't filed tax returns for three years earlier. So, here's the drill: If you didn't file a 2002 return, do so by April 17, 2006. If you don't, you lose. The money, that is.
Last year, the IRS said it had more than $2 billion that was to 1.7 million taxpayers who never filed 2001 tax returns. If they didn't file those returns by April 15, 2005, they gave up their rights to claim the money. And, yes, Uncle Sam got to keep the cash.
The IRS estimated that about half of the nonfilers could have claimed refunds of more than $484 each. California was home to the most taxpayers (almost 189,000) who didn't send in returns in 2001, accounting for $229 million of the total unclaimed pot. But some taxpayers in every state are missing federal refund money, as are residents of U.S. territories, military filers stationed abroad and taxpayers living overseas.
When must you file a return?
Despite the staggering amount, the IRS says that unclaimed refund money is not that unusual.
Each year, some people don't file a return because they don't owe taxes. But without the documentation, these folks won't get any refunds they're due. The IRS doesn't send refunds without a Form 1040 (or 1040A or 1040EZ) that details just how big the government check should be.
Other taxpayers had income tax withheld but didn't have to file a return because they earned too little. But the only way they can get the withheld money back is to file a return.
And then there are individuals who were eligible for but didn't take the Earned Income Tax Credit. This is a tax break for workers who don't earn much. It can actually rebate cash to qualified filers -- even those who owe nothing. In 2005, individuals qualify for the earned income credit if they made less than $11,060 and were childless, earned less than $29,202 and had one child or earned no more than $33,178 and had two or more kids.
For the 2004 tax year, you are required to file if you are single, under 65 and your gross income was more than $7,950 ($10,050 for heads of household under 65 and $17,900 for married couples under 65 filing jointly). That amount should rise in 2005.
No penalty, but no payoff either
There is no penalty for late-filing in cases where the taxpayer is due a refund. However, if you subsequently ran up an IRS bill that you didn't pay or you owe another government debt, such as child support or a student loan, you may not get all of your 2001 refund. In these cases, once the nonfiler finally gets a return to the IRS the tax cash will be applied to outstanding charges before any remainder is refunded.
If you think some of the refund stash is yours, you can download a 2001 Form 1040 from the IRS Web site. If you need an old 1040A or 1040EZ instead, you can find them at the agency's index of past-year forms. And be sure to check out the 2002 and 2003 documents if you didn't file a return for those years either. The IRS won't send you your '01 cash unless you filed in subsequent years.
Taxpayers who prefer the phone to the PC can call toll-free 1-800-829-3676 to request an old form. You probably should ring up the IRS no later than mid-March to allow ample time for processing and to make sure the forms get to you in time to meet the April deadline. Once the forms are in hand, taxpayers who need help completing old returns or in gathering past income records may call the IRS help line, also toll-free, at 1-800-829-1040.
But whatever tax-filing moves you have to make to claim your cash, make them soon. After April 17, it stays in Uncle Sam's pocket.
Just so you know how many people might be involved, the table below shows a state-by-state breakdown of estimates for individuals who failed to file a 2001 return with a refund due:
| Who's owed and how much | | State | Individuals | Median refunds | Total refunds (MM) | | Alabama | 26,700 | $459 | $24.1 | | Alaska | 8,100 | $501 | $11.0 | | Arizona | 34,400 | $415 | $32.2 | | Arkansas | 15,100 | $439 | $13.1 | | California | 188,800 | $456 | $229.1 | | Colorado | 26,600 | $451 | $34.4 | | Connecticut | 19,200 | $586 | $31.9 | | Delaware | 5,600 | $477 | $6.6 | | District of Columbia | 6,200 | $513 | $8.3 | | Florida | 115,200 | $482 | $151.4 | | Georgia | 58,100 | $475 | $65.1 | | Hawaii | 9,900 | $525 | $12.7 | | Idaho | 5,900 | $399 | $5.9 | | Illinois | 66,900 | $537 | $95.6 | | Indiana | 32,000 | $513 | $35.4 | | Iowa | 15,800 | $444 | $12.7 | | Kansas | 17,100 | $454 | $16.4 | | Kentucky | 19,300 | $533 | $22.3 | | Louisiana | 25,700 | $471 | $30.6 | | Maine | 6,100 | $440 | $7.4 | | Maryland | 33,700 | $512 | $45.0 | | Massachusetts | 36,200 | $557 | $63.2 | | Michigan | 61,200 | $522 | $73.9 | | Minnesota | 22,900 | $439 | $24.8 | | Mississippi | 14,100 | $416 | $12.3 | | Missouri | 32,800 | $451 | $31.5 | | Montana | 4,300 | $417 | $5.9 | | Nebraska | 8,100 | $426 | $7.7 | | Nevada | 18,800 | $445 | $20.0 | | New Hampshire | 7,000 | $538 | $10.2 | | New Jersey | 51,000 | $570 | $79.4 | | New Mexico | 11,400 | $482 | $12.9 | | New York | 107,100 | $535 | $170.5 | | North Carolina | 45,400 | $417 | $44.1 | | North Dakota | 2,300 | $407 | $1.7 | | Ohio | 54,600 | $470 | $60.4 | | Oklahoma | 22,900 | $451 | $21.8 | | Oregon | 23,700 | $415 | $23.9 | | Pennsylvania | 55,600 | $522 | $67.6 | | Rhode Island | 5,600 | $485 | $6.5 | | South Carolina | 18,600 | $414 | $18.6 | | South Dakota | 2,900 | $423 | $2.8 | | Tennessee | 27,400 | $457 | $29.0 | | Texas | 141,400 | $512 | $170.3 | | Utah | 9,900 | $403 | $10.6 | | Vermont | 3,000 | $458 | $3.7 | | Virginia | 46,900 | $481 | $60.0 | | Washington | 43,100 | $520 | $58.0 | | West Virginia | 5,200 | $472 | $5.5 | | Wisconsin | 18,700 | $429 | $18.2 | | Wyoming | 3,000 | $493 | $3.9 | | Armed Forces | 6,700 | $450 | $4.9 | | U.S. Possessions | 1,500 | $746 | $2.1 | | Foreign | 4,200 | $900 | $17.5 | | Total | 1,653,900 | $484 | $2,045.0 |
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*Excluding Earned Income Tax Credit
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