Monday, November 19, 2007

Can We Find A Home For $110 Million In Refunds

On November 14, 2007, the IRS released, “IRS Has $110 Million In Refund Checks Looking For A Home”, which should make every taxpayer take notice.

The announcement stated that there were 115,478 taxpayers who are due refund checks worth about $110 million. Why? It’s simple, the checks have been returned as undeliverable.

The refund checks averaged about $953 each. Claiming these refunds is as easy as updating your address. The alarming statistic is that some taxpayers have more than one check waiting.
“Taxpayers should not miss out on getting their money back,” said Richard Morgante, commissioner of the IRS Wage and Investment Division. ”The IRS makes it as easy as possible for taxpayers to update their addresses and claim their refunds.”

The IRS.gov tool on their website called “ Where’s My Refund?” enables you to check the status of your refunds. You will be required to provide your social security number, filing status and amount of refund shown on your 2006 return. This tool will give the status of your refund and will provide instructions on how to resolve delivery problems. The telephone version of “Where’s My Refund?” requires calling 1-800-829-1954.

To date (2007), the IRS has processed nearly 105 million refunds, totaling about $240 billion, either by mail or direct deposit. Undeliverable refunds account for less than one-tenth of one percent of all refunds, or about one in a thousand.

Normally a refund check is returned as undeliverable due to taxpayers moving and not updating their address with either the U.S. Postal Service or the IRS.

According to the IRS, the list of taxpayers due undeliverable refunds this year rose about 21 percent from 95,746 last year. The increase is due in part to the Telephone Excise Tax Refund. The refund was a one-time payment available on 2006 federal income tax returns. It was designed to return to individuals, businesses and tax-exempt organizations previously collected long-distance telephone taxes.

Refund checks are mailed to a taxpayer’s last known address. Checks are returned to the IRS if a taxpayer moves without notifying the IRS or the U.S. Postal Service. Updating your address is easy, just access the “ Where’s My Refund?” feature at www.irs.gov. Taxpayers checking on a refund will be asked to provide an updated address if there is an undelivered check outstanding within the last 12 months. Taxpayers checking on a refund over the phone will be given specific instructions on how to update addresses.

A taxpayer can also ensure the IRS has his or her correct address by filing Form 8822, Change of Address (Download the form) or request it by calling 1-800-TAX-FORM (1-800-829-3676). Those who do not have access to the Internet and think they may be missing a refund should first check your returns or contact your tax preparer if the returns are not available, then call the IRS toll-free assistance line at 1-800-829-1040 to update your address.

Requesting Direct Deposit can put an end to undelivered refunds, as well as lost or stolen refund checks. Taxpayers can have refunds deposited directly into their personal checking or savings accounts. Direct Deposit is available for filers of both paper and electronic returns. For paper returns, just fill out the routing and account information on the bottom of Page 2 of the 1040 above the signatures spaces.

How often do you hear the government say that they owe you? Now is the time to regain what is rightfully yours. Have you moved in the last year to two, if so, it’s definitely worth making that call or going online. Remember, every day that this money is not claimed is another day of interest that the IRS is making off of your money, and at $110 million, that’s a lot of interest.

Sharon Raines, Sr. Financial Advisor/Tax Preparer

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