Does the IRS Owe You Money....Again?
Yesterday the IRS said that it estimates about $1.1 Billion in unclaimed refunds may be lost if come April 18, 2011. There are an estimated 1.1 Million taxpayers needing to file their 2007 tax returns to claim these refunds. The IRS estimates that half of these refunds are $640 or more.
To add insult to injury, many of these tax payers are low income and may be due the Earned Income Tax Credit, which can create even a larger refund. Also, my own experience is that many of these taxpayers are not filing due to outstanding tax problems or at least percieved tax problems. They may need to file several years tax returns and will miss out on a refund because they are concerned that one or more of the other years needing to be filed has an amount due. In reality, many of those tax years for which you need to file may be zero taxes owed, may be even a refund (which you may not collect but at least don't owe the IRS) for some years.
So the best approach is to get with an enrolled agent to get your 2007 and any other outstanding tax returns filed so you don't lose your 2007 refund. Otherwise, come midnight April 18th, 2011 (I guess it really is midnight on April 19th), you will lose your 2007 refund.
Sean Monohan | 03/01/2011