You May Have an Unclaimed Tax Refund – Here’s How to Find It!
Did you know that the federal government may actually owe you money? Every year, American workers file and pay their federal and state taxes. If you are one of the lucky ones, you will receive a refund if you paid more than your fair share. However, some taxpayers have federal income tax refunds that they never claimed. According to the IRS, there is currently more than $1.3 billion in unclaimed tax refunds just waiting to be distributed. For the 2017 fiscal year alone, there are approximately 1.3 million people who failed to file and get their refund. If you believe you might be one of these people, you will need to act fast to get your money. The clock is ticking though, so here is how you can find out if you have an unclaimed tax refund.
Why Would I Have an Unclaimed Tax Refund?
Although it seems strange that people would not claim their refunds, it can happen for several reasons. For example, some people are not required to file returns if their gross income is below the threshold for age and filing status. However, if your employer still withheld taxes from your paycheck, you may have an unclaimed tax refund.
Another reason it happens is when taxpayers qualify for the Earned Income Tax Credit, but fail to include it on their return. This refundable tax credit exists specifically to reduce the tax liability for low-income earners. If you are eligible to claim this credit, it offsets anything you may owe, helping you keep more of your hard-earned money. If the credit is more than you owe, or you owe nothing at all, you are likely among those who have unclaimed money. Unfortunately, the only way to get the credit and your unclaimed tax return is by filing your annual return.
Lastly, taxpayers who have refunds marked as ‘undeliverable funds’ may also have unclaimed tax returns waiting for them. This occurs when the IRS is unable to complete a direct deposit or mail your check due to incorrect information. If your local postal service returned your refund to the IRS, then you likely need to update your mailing address. Since the IRS will not chase you down to get you your money, it is up to you to follow up and ensure they have accurate information. However, if you already filed but have not received your refund yet, visit this link to track it.
Where Can I Find Out If I Have an Unclaimed Tax Refund?
If the government owes you money, the burden of responsibility falls on your shoulders to find out. As nice as it would be, the IRS and state governments are unlikely to track you down to pay money they owe you. Therefore, the only way to get an unclaimed tax return is by completing a return. However, the good news is that if you have an unclaimed federal return, then you likely have unclaimed state returns as well.
The best way to find out if you have an unclaimed tax refund is to go straight to the source. There are some websites out there that can help you claim it. But, they usually charge or attempt to solicit their products and services. You should also be wary of scammers who contact you about claiming refunds. If they are requesting personal information or ask you to sign documents releasing funds to them, it is probably someone trying to separate you from your money. If you are uncertain, you can always check the validity of any company through the Better Business Bureau. However, the IRS website is the best resource to determine if they owe you any money.
How Can I Get an Unclaimed Tax Refund?
Every year, the IRS issues public alerts about unclaimed returns to urge people to file their tax returns. Since it is the only way to find out if you have money waiting for you, it encourages people to stay current and file their annual return. However, if you failed to file a past return or need to complete one from previous years, you can find the correct forms and directions here. Be advised that you must have your income forms, though. So, you may need to get in touch with previous employers or clients if you do not have them. If this is impossible, you can also request a wage and income transcript directly through the IRS. Since companies must report all employee earnings, you can request this information online or using Form 4506-T.
You should also be aware that there is a strict timeline to claim your refund. If you think that the IRS owes you money, you have three years from the original filing deadline to access your funds. Thankfully, the tax filing deadline was extended this year. That means you have until May 17 to file and receive any unclaimed funds from 2017 or later. However, if you miss this deadline, you will miss your opportunity to get what is owed to you. After this point, Uncle Sam keeps your money and there is no other way to claim it once the deadline passes. So, you do not want to procrastinate and potentially lose hundreds, or even thousands, of dollars of your hard-earned cash.
Expert Tax Advice
If you are hesitant to file a past return and claim your money, you don’t need to be. You can rest assured because there are no penalty fees to get an unclaimed tax refund. While they may charge late filing penalties if you owe the IRS, its costs you nothing when the IRS owes you.
However, if you need expert advice, you do not need to hire a tax professional. There are free programs out there, like Volunteer Income Tax Assistance, which can answer your questions and help prepare your taxes. No one likes filing taxes. But, it is always better to file a tax return, even if you are not required to. It may be to your benefit, especially if you have an unclaimed income tax refund with your name on it.
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