Every tax year million of taxpayers leave unclaimed money for the Treasury.
Almost $1.5 billion unclaimed tax refunds may be waiting for an estimated 1.5 million taxpayers who did not file a 2018 tax return, according to the Internal Revenue Service. The unclaimed refunds for 2018 must be claimed by April 18, 2022.
An estimated 98,979 individuals in Florida have $94,578,672 of potential unclaimed refunds.
There are some taxpayers who still file paper returns and did not request direct deposit. As a result, some errors are more likely to go undetected and some checks went uncashed. An estimated more than 2 million paper refunds, totaling $1.2 billion, went uncashed over a 2 year period. As reported, each year, almost 700,000 of uncashed refunds were under $50.00. For tax year 2018, there were over 70,000 paper refunds filed.
When taxpayers do not file their tax returns they could potentially leave money to the Treasury. The IRS has reported that an estimated 11,000,000 taxpayers do not file their tax return each tax year period. Many of them have refunds unclaimed left for the service. Those refunds could not be claimed after 3 years, except under special circumstances.
According to the Internal revenue Service, the thresholds for 2018 were:
- $49,194 ($54,884 if married filing jointly) for those with three or more qualifying children;
- $45,802 ($51,492 if married filing jointly) for people with two qualifying children;
- $40,320 ($46,010 if married filing jointly) for those with one qualifying child; and
- $15,270 ($20,950 if married filing jointly) for people without qualifying children.
“The IRS reminds taxpayers seeking a 2018 tax refund that their checks may be held if they have not filed tax returns for 2019 and 2020. In addition, the refund will be applied to any amounts still owed to the IRS or a state tax agency and may be used to offset unpaid child support or past due federal debts, such as student loans”.
It is important to file your returns for several reasons:
- You will need at least 2 years of tax returns for real estate purchases.
- You will need your tax return to file for student loan.
- You might need proof of tax filing compliance for transactions with different government entities: local, state, and federal.
- You need to be in compliance for the past 6 years to obtain an abatement, an installment agreement, an offer in compromise from the IRS.
- You might need your tax return to apply for a loan.
- and so on…
Be proactive when it comes to your tax return. It is advised to file your tax return even when you might not owe or you do not need the refund because you never know when you would need proof of tax compliance or income. Do not wait until you need a proof tax compliance or income because it might cost you much more and further, you might not be able to get it a the time needed.
Do not act on the advice of non tax professionals. Taxpayers’ financial circumstances could be unique. Most tax professionals offer free initial consultation. Always get a least 2 consultations before taking action.
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