$1.3 Billion in Unclaimed Refunds
One thing you might not know about the IRS is that if you don’t file a tax return, they prepare one for you— whether you ask them to or not. Surprised? Well you shouldn’t be. They take the information documents that they’re sent, like your W2s, and then they compute your taxes using the worst possible filing status. If it comes out showing that you owe, then you’ll get a letter.
But what happens if they find out that you should be getting a refund? Well, nothing. They don’t send you a letter saying, “Dear Sir: Even though you’re too lazy to file your income taxes yourself, we’ve done them for you and we want to send you a refund.” Right now, the IRS has data showing that there is $1.3 billion of unclaimed income tax refunds for 2006. If you’ve got a refund coming, and you don’t file your 2006 return by April 15th of 2010, then you will have lost any opportunity of claiming that money.
But why bother? How much money are we talking about for one person? Of the people who have refunds coming across the nation, the median refund is estimated to be $603. But that’s based upon the IRS doing your taxes. You could, in fact, be owed much more. For example: let’s say you are a divorced mother with two school-aged children and a mortgage. When the IRS does your return, they compute your taxes based upon you being single, taking a standard deduction, and having no children. In a case like this, that $603 refund could be worth over $4,000.
So how do you know if you’ve got money coming? You gotta file. The deadline is this April 15. If you don’t ask, you don’t get.
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