Tax Analysts®Tax Analysts®

My Subscriptions:

Featured News

March 19, 2008
IRS Has $1.2 Billion for People Who Have Not Filed a 2004 Tax Return

Full Text Published by Tax Analysts®

Document originally published in Tax Notes Today
on March 20, 2008.

Citations: IR-2008-46

Date: Mar. 19, 2008

WASHINGTON — Unclaimed refunds totaling approximately $1.2 billion are awaiting about 1.3 million people who failed to file a federal income tax return for 2004, the Internal Revenue Service announced today. However, to collect the money, a return for 2004 must be filed with an IRS office no later than Tuesday, April 15, 2008.

Those due a refund who did not file a 2004 tax return could collect even more money by also filing a 2007 tax return to claim the economic stimulus payment. To receive a payment, taxpayers must have a valid Social Security number, $3,000 of qualifying income and file a 2007 federal tax return. Millions of retirees, disabled veterans and low-wage workers who usually are exempt from filing a tax return must do so this year in order to receive the stimulus payment. Eligible people will receive up to $600 ($1,200 for married couples), and parents will receive an additional $300 for each eligible child younger than 17.

The IRS estimates that half of those who could claim refunds for tax year 2004 would receive more than $552. In some cases, individuals had taxes withheld from their wages, or made payments against their taxes out of self-employed earnings, but had too little income to require filing a tax return. Some taxpayers may also be eligible for the refundable Earned Income Tax Credit.

In cases where a return was not filed, the law provides most taxpayers with a three-year window of opportunity for claiming a refund. If no return is filed to claim the refund within three years, the money becomes property of the U.S. Treasury. For 2004 returns, the window closes on April 15, 2008. The law requires that the return be properly addressed, postmarked and mailed by that date. There is no penalty assessed by the IRS for filing a late return qualifying for a refund.

"Time is getting short for claiming the tax refund you may be entitled to," said acting IRS Commissioner Linda E. Stiff. "But you can't get it unless you file the tax return. Don't take a chance on losing your tax refund. And this year, remember that you need to file a 2007 tax return in order to receive an economic stimulus payment."

The IRS reminds taxpayers seeking a 2004 refund that their checks will be held if they have not filed tax returns for 2005 or 2006. In addition, the refund will be applied to any amounts still owed to the IRS and may be used to satisfy unpaid child support or past due federal debts such as student loans.

By failing to file a return, individuals stand to lose more than refunds of taxes withheld or paid during 2004. Many low-income workers may not have claimed the Earned Income Tax Credit (EITC). Although eligible taxpayers may get a refund when their EITC is more than what they owe in tax, those who file returns more than three years late would be able only to apply it toward the taxes they owe (if any). They would not be able to receive a refund if the credit exceeded their tax.

Generally, unmarried individuals qualified for the EITC if in 2004 they earned less than $34,458 and had more than one qualifying child living with them, earned less than $30,338 with one qualifying child, or earned less than $11,490 and had no qualifying child. Limits are slightly higher for married individuals filing jointly.

Current and prior year tax forms and instructions are available on the Forms and Publications page of the IRS Web site at or by calling 1-800-TAX-FORM (1-800-829-3676). Information about the Earned Income Tax Credit and how to claim it is also available on the IRS Web site, Taxpayers who need help also can call the toll-free IRS help line at 1-800-829-1040.

A state-by-state breakdown of estimates for individuals who failed to file a 2004 return with a refund due is attached.


State-by-state breakdown of estimates

 Individuals Who Failed to File a 2004 Return with an Estimated Refund

                               Median    Estimated
                               Estimated Refunds
                Individuals    Refund
*   ($000)*

 Alabama            20,700       $548    $16,210
 Alaska              6,000       $643     $6,514
 Arizona            33,100       $465    $26,175
 Arkansas           11,100       $514     $8,706
 California        149,500       $507   $134,399
 Colorado           22,900       $504    $20,048
 Connecticut        15,000       $617    $16,484
 Delaware            4,900       $561     $4,175
 Dist of Columbia    5,200       $528     $4,655
 Florida            93,900       $575   $100,600
 Georgia            43,900       $519    $37,821
 Hawaii              8,900       $581     $9,353
 Idaho               5,000       $464     $3,776
 Illinois           50,000       $608    $53,131
 Indiana            26,100       $588    $22,888
 Iowa               11,500       $566     $9,002
 Kansas             12,700       $536     $9,903
 Kentucky           14,100       $566    $11,734
 Louisiana          21,600       $562    $20,902
 Maine               4,700       $533     $4,008
 Maryland           29,700       $548    $27,275
 Massachusetts      29,500       $605    $32,934
 Michigan           47,000       $582    $42,580
 Minnesota          19,200       $498    $15,930
 Mississippi        11,200       $499     $8,357
 Missouri           24,900       $527    $19,627
 Montana             3,600       $490     $2,665
 Nebraska            5,900       $527     $4,752
 Nevada             17,500       $520    $16,776
 New Hampshire       5,300       $633     $5,011
 New Jersey         40,500       $621    $41,979
 New Mexico          8,700       $502     $7,041
 New York           76,600       $612    $81,951
 North Carolina     36,000       $491    $29,724
 North Dakota        1,900       $531     $1,537
 Ohio               43,600       $544    $35,744
 Oklahoma           15,900       $515    $12,611
 Oregon             20,400       $449    $14,596
 Pennsylvania       45,700       $598    $41,455
 Rhode Island        4,500       $579     $4,411
 South Carolina     15,200       $485    $11,384
 South Dakota        2,400       $542     $2,023
 Tennessee          21,100       $559    $19,191
 Texas              96,600       $582    $93,090
 Utah                7,400       $470     $5,811
 Vermont             2,300       $538     $1,779
 Virginia           38,400       $543    $37,247
 Washington         34,400       $587    $34,337
 West Virginia       4,500       $591     $4,033
 Wisconsin          15,900       $522    $13,026
 Wyoming             2,500       $616     $2,344
 Armed Forces        5,500       $770     $4,332
 US Possessions &
 Territories           100       $591       $103
 Total           1,294,700       $552 $1,196,140


* Excluding the Earned Income Credit and other tax


About Tax Analysts

Tax Analysts is an influential provider of tax news and analysis for the global community. Over 150,000 tax professionals in law and accounting firms, corporations, and government agencies rely on Tax Analysts' federal, state, and international content daily. Key products include Tax Notes, Tax Notes Today, State Tax Notes, State Tax Today, Tax Notes International, and Worldwide Tax Daily. Founded in 1970 as a nonprofit organization, Tax Analysts has the industry's largest tax-dedicated correspondent staff, with more than 250 domestic and international correspondents. For more information, visit our home page.

For reprint permission or other information, contact