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More than 1.7 million US taxpayers have over 2 billion dollars in unclaimed income tax refunds for 2001. If you think you couldn't possibly be one of them, think again.
Every year, millions of US taxpayers walk away from their income tax refunds, often because they didn't realize they had one coming. The law allows three years from the filing deadline (April 15th) to file your income tax return to claim a refund. If you don't file within the time limit, the money is lost to you forever. As tax time approaches for tax year 2004, time is running out for unclaimed refunds for tax year 2001.
The problem often arises because you're not required to file a return unless you earned over a certain amount. In 2001, for example, you were not required to file an income tax return if you were:
- Single, under age 65, and earned less than $7,450
- Married, under age 65, and earned less than $13,400
- Single, older than 65, and earned less than $8,550
- Married, older than 65, and earned less than $15,200, excluding Social Security.
People often make the mistake of thinking that because they aren't legally required to file an income tax return, they don't need to bother. Often those people would receive a refund if they did file, even though they're not required to.
People who unknowingly leave unclaimed refunds to the IRS include:
- Students
- Workers who work part-time or for only part of the year but had income taxes withheld
- Self-employed workers with low earnings who made estimated tax payments but didn't file a return because their earnings were below the threshold
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Individuals who fail to file a final returned for a deceased family member who is due a refund
- Individuals who qualified for the earned income credit but didn't file a return because their earnings were below the threshold.
The earned income credit helps qualified low-income individuals and families by paying them back some of the taxes they paid, and in some cases, paying them even though they owed no taxes to begin with. In 2001, taxpayers were eligible for the earned income credit if they:
- Had two or more children and earned less than $32,121
- Had one child and earned less than $28,281
- Had no children and earned $10,710 or less (single taxpayers must be at least 25 years
old and cannot be a dependent of another taxpayer.
Check your records to make sure you've filed a tax return for each of the last three years that you had earnings. Review your returns for the last three years to make sure they're accurate and to determine if you were eligible for the earned income credit but didn't claim it.
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