About 1. 7 million people are missing out on more than $2 billion in refunds for taxes they paid three years ago.
WASHINGTON — About 1.7 million people are missing out on more than $2 billion in refunds for taxes they paid three years ago.
Many of them just never filed returns. It’s not too late, but the window to claim the money closes in nine weeks.
“As soon as you send us your tax return, you’ll get your money,” Internal Revenue Service (IRS) Commissioner Mark Everson said yesterday. “But if you don’t file, you won’t get anything.”
Most Read Stories
- Billionaire Paul Allen pledges $30M toward permanent housing for Seattle’s homeless
- Seattle just broke a 122-year-old record for rain — because of course it did
- Is Seattle a target for a North Korean nuclear attack? Well, not quite yet, insiders say
- Seahawks' Marshawn Lynch agrees to contract with Raiders, is traded to Oakland in exchange of 2018 draft picks
- Boeing’s budget ax falls on popular gym for employees
Taxpayers must act by April 15 to claim a refund for taxes paid in 2001, under laws that make the money the property of the U.S. Treasury after sitting unclaimed for three years.
The IRS estimated that half the people due refunds could claim more than $484. It takes a 2001 tax return, filed by mail, to get that check. There’s no penalty for filing a return late to claim a refund.
People who unknowingly leave refunds unclaimed often earned some wages and had taxes withheld from their paychecks, but they worked less than a full-time, year-round job.
“So that the amount withheld per paycheck is more than is needed to satisfy any tax obligation,” said Kathy Burlison, director of tax implementation at H&R Block.
That points to high-school or college students and retirees. Others made self-employment tax payments during the year. Although they avoid the paperwork, they might not realize how much money they’re giving up.
“They’ve had withholdings and they figure, ‘I don’t owe any tax, it’s not a big deal,’ ” said William White, president of Online Taxes in St. Joseph, Mo.
In 2001, taxpayers younger than 65 weren’t required to file if they were single and earned less than $7,450, or married and earned less than $13,400. Those 65 and older weren’t required to file if they were single and earned less than $8,550 or married and earned less than $15,200, excluding Social Security.
Those due refunds might also include people who went through a major life change that year, such as a death in the family, a divorce or a move, and put their taxes on hold.
“Big life changes can cause people to just overlook it,” Burlison said.
Some might also be low-wage workers who qualified but didn’t claim the earned income tax credit, a benefit aimed at lifting working families out of poverty.
Individuals qualified for the credit in 2001 if they had two or more children and earned less than $32,121 or had one child and earned less than $28,281. Those with no children qualified if they earned less than $10,710.
The deadline should prompt everyone to review their old tax returns and see if they overlooked something, Burlison said. Everyone is running out of time to file an amended 2001 return.
“Now is a good time, while you’re doing your 2004 return, to take a look at those tax returns back to 2001 and see if everything makes sense,” she said.
Taxpayers who file a 2001 tax return to claim a refund won’t get the money if they didn’t file returns in 2002 and 2003. The money will be held until those returns are submitted.
The IRS may also withhold a tax refund to satisfy unpaid tax debts, child support or other federal debts, such as student loans.
Anyone who might be due a refund needs their wage and income information from past years to fill out the return. They can be obtained through employers, financial institutions or the IRS.
Tax forms for past years can be found on the IRS Web site or by calling 800-TAX FORM (800-829-3676).