No Refunds for Returns Over 3 Years Old?


F

fleemo17

One of the first things I did as a newlywed was to take care
of some of the business my new wife had neglected for years,
which included filing tax returns! She had not filed in the
last six years. After finally having her taxes done by a
tax preparer, they told her that she would not be receiving
any refunds on returns older than three years. Is this
true? The amounts to be refunded are significant.

Thanks.

-Fleemo
 
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P

Paul A Thomas

One of the first things I did as a newlywed was to take care
of some of the business my new wife had neglected for years,
which included filing tax returns! She had not filed in the
last six years. After finally having her taxes done by a
tax preparer, they told her that she would not be receiving
any refunds on returns older than three years. Is this
true? The amounts to be refunded are significant.
Yes, it's true. Unfortunately it's an expensive lesson.

http://www.latimes.com/business/taxes/la-na-refunds9feb09,1,964862.story?coll=la-headlines-business-taxes&ctrack=1&cset=true
WASHINGTON - About 1.7 million people are missing out on
more than $2 billion in refunds for taxes they paid three
years ago, the Internal Revenue Service said Tuesday. Many
of them just never filed returns. It's not too late - but
the window to claim the money closes in nine weeks
 
T

Thomas Healy

One of the first things I did as a newlywed was to take care
of some of the business my new wife had neglected for years,
which included filing tax returns! She had not filed in the
last six years. After finally having her taxes done by a
tax preparer, they told her that she would not be receiving
any refunds on returns older than three years. Is this
true? The amounts to be refunded are significant.
Yes it's true. It's the cost of not keeping up. Don't nag
about it though, it's water under the bridge.
 
D

David Woods, EA, ChFC, CLU

One of the first things I did as a newlywed was to take care
of some of the business my new wife had neglected for years,
which included filing tax returns! She had not filed in the
last six years. After finally having her taxes done by a
tax preparer, they told her that she would not be receiving
any refunds on returns older than three years. Is this
true? The amounts to be refunded are significant.
It is true.
 
M

mytax

A taxpayer has three years to collect any refund from IRS.
If they do not file tax returns in that amount of time they
forfeit the refund(s).

Missy Doyle
 
T

traalfaz2

After finally having her taxes done by a tax preparer,
they told her that she would not be receiving any refunds
on returns older than three years >>
yes. You have three years from the due date of a federal
income tax return to file for any refund. You may want to
double check as to state policy as not all states follw the
same statute of limitations.
The amounts to be refunded are significant.
Not to be rude, but she should have filed for her refunds in
a timely manner as her loss is now the US Gov't gain.

Dave
 
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F

Frederick Lorca

One of the first things I did as a newlywed was to take care
of some of the business my new wife had neglected for years,
which included filing tax returns! She had not filed in the
last six years. After finally having her taxes done by a
tax preparer, they told her that she would not be receiving
any refunds on returns older than three years. Is this
true? The amounts to be refunded are significant.
That's correct. The three-year refund statute found in
Internal Revenue Code § 6511 authorizes IRS to refund
overpayments on returns filed within 3 years of the regular
or properly extended due date. For this reason, tax years
prior to 2001 are statute-barred for refunds. If she's due
refunds for tax years beginning after 12/31/2000, she should
receive them if she owes no federal taxes and does have any
delinquent federal debts, such as student loans.

As for the older years, tax years 2000 and prior, IRS will
send her a Letter 105C for each year that formally denies
the statute-barred refund.

Frederick Lorca
 
W

Wayne Brasch

One of the first things I did as a newlywed was to take care
of some of the business my new wife had neglected for years,
which included filing tax returns! She had not filed in the
last six years. After finally having her taxes done by a
tax preparer, they told her that she would not be receiving
any refunds on returns older than three years. Is this
true? The amounts to be refunded are significant.
No refunds can be had for years prior to 2001 as of right
now. On April 15, 2005, 2001 will become a closed
year-meaning no refund from that year.

Wayne Brasch, CPA, M. S. Taxation
 
D

D.F. Manno

One of the first things I did as a newlywed was to take care
of some of the business my new wife had neglected for years,
which included filing tax returns! She had not filed in the
last six years. After finally having her taxes done by a
tax preparer, they told her that she would not be receiving
any refunds on returns older than three years. Is this
true? The amounts to be refunded are significant.
That's correct. You have three years from the due date of
the return to file a return and claim a refund. Wait longer
than three years, and you've given the government a gift.
(And it doesn't even send a thank-you note.)
 
D

D. Stussy

One of the first things I did as a newlywed was to take care
of some of the business my new wife had neglected for years,
which included filing tax returns! She had not filed in the
last six years. After finally having her taxes done by a
tax preparer, they told her that she would not be receiving
any refunds on returns older than three years. Is this
true? The amounts to be refunded are significant.
Yes, that is true. A taxpayer has the latter of three years
from the original due date or two years from payment to
claim a refund. Amounts withheld and estimated tax payments
are considered paid on the due date for purposes of this
rule.
 
F

fleemo17

Thank you all for taking the time to respond. An expensive
lesson indeed!

-Fleemo
 
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E

effi

One of the first things I did as a newlywed was to take care
of some of the business my new wife had neglected for years,
which included filing tax returns! She had not filed in the
last six years. After finally having her taxes done by a
tax preparer, they told her that she would not be receiving
any refunds on returns older than three years. Is this
true? The amounts to be refunded are significant.
i believe what you will find is a claim for refund of
federal income tax must generally be made within:

a) 3 years of the due date (including valid extensions) of
the original return, or

b) 2 years of the date the tax was paid,

whichever is later
 
B

baumgrenze

Stands to reason, doesn't it.

There is no statute of limitations if you fail to pay, but a
limitation 3 years if you overpay and don't claim a refund.

Either way, Uncle Sugar wins!

Baumgrenze
 
S

Stuart A. Bronstein

D.F. Manno said:
That's correct. You have three years from the due date of
the return to file a return and claim a refund. Wait longer
than three years, and you've given the government a gift.
(And it doesn't even send a thank-you note.)
Can you write off the gift in the third year?

Stu
 
D

David Woods, EA, ChFC, CLU

Can you write off the gift in the third year?
It isn't a gift unless it was freely and voluntarily given.
If this the case, the person who does it is:

A) Soft
B) Stupid
C) Really stupid
D) Has trouble with doorknobs

If you WANTED to simply give money to the government, there
is an actual fund to do it.
 
T

TaxmanHog

baumgrenze said:
Stands to reason, doesn't it.

There is no statute of limitations if you fail to pay, but a
limitation 3 years if you overpay and don't claim a refund.

Either way, Uncle Sugar wins!
Uncle takes the same risks regarding the Assessment Statute
of limitations in the examination of filed returns, for the
most part THREE YEARS, if uncle set's on his keister too
long he looses too!

The practical reasons for limiting examination assessments,
and refunds on late filed returns are hand in hand, as time
goes on, it becomes more difficult to find third party
records to validate claims and commence with cross-audits.
 
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D

D. Stussy

baumgrenze said:
Stands to reason, doesn't it.

There is no statute of limitations if you fail to pay, but a
limitation 3 years if you overpay and don't claim a refund.
Wrong. The period of limitations for not paying is 10 years
from the date of assessment (or return processing). There
is no period if one doesn't FILE.
 
D

D. Stussy

It isn't a gift unless it was freely and voluntarily given.
If this the case, the person who does it is:

A) Soft
B) Stupid
C) Really stupid
D) Has trouble with doorknobs

If you WANTED to simply give money to the government, there
is an actual fund to do it.
But it may be a charitable contribution..... The U.S.
Government is a qualified charity under IRC 170. However,
remember that if it's over $250, you need an acknowledgement
letter.
 
E

effi

baumgrenze said:
Stands to reason, doesn't it.

There is no statute of limitations if you fail to pay, but a
limitation 3 years if you overpay and don't claim a refund.

Either way, Uncle Sugar wins!
Re: "There is no statute of limitations if you fail to pay"

if one doesn't pay the tax they owe, there is generally a 10
year statute of limitations on collection by the irs, once
the irs has assessed the tax or the taxpayer has self
assessed (like with the voluntary filing of a return) the 10
year period can be extended by the irs going to court and
getting a judgement, in some cases
 
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T

TaxSrv

D. Stussy said:
But it may be a charitable contribution..... The U.S.
Government is a qualified charity under IRC 170.
However, remember that if it's over $250, you need
an acknowledgement letter.
A lost refund under $250 isn't a donation either. There's
no way to prove that foregoing a refund was for the purpose
of making a donation. You first would have to prove you
knew there was a refund, meaning preparing a return and
deciding not to file it before the bar date as a charitable
gesture. Then prove that was your intent.

Only IRS can argue substance over form. T/ps are stuck with
form over substance, if IRS wants it that way. Here, form
is unprovable anyway.

Fred F.
 
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