Finance Tax Time

Every year, the IRS announces that it is holding unclaimed tax refunds. Taxpayers have a limited time to claim the $2 billion dollars the IRS is currently holding.

Three years is a magical number when it comes to tax returns. It refers to the statute of limitations on certain tax issues such as when an audit can occur, when refunds can be claimed and when amended tax returns can be filed. The IRS is currently holding $2 billion dollars in unclaimed tax refunds for the 2002 tax year and taxpayers must file their claims by April 17, 2006 or lose the refunds forever.

Approximately 1.7 million people are due refunds out of the $2 billion dollars currently held by the IRS. These people have refunds due because they failed to file tax returns for 2002. This occurred most likely because people felt they did not make enough money to warrant filing a tax return. By failing to file, however, they have left $570 on average with the IRS.

If a taxpayer fails to claim the tax refund by filing a tax return for 2002, the money will default to the federal government. Importantly, there is no penalty associated for filing late if a taxpayer is due a tax refund. This is common misconception among non-filers.

One group of taxpayers that almost always has a large percentage of non-filers is military personnel. Obviously, it is a bit hard to file from Afghanistan, but now is the time to do so for 2002. Members of the military that failed to file in 2002 are owed an average of $749 per taxpayer.

The IRS releases demographic on the areas in the United States where refunds are due. To this end, California and Texas are the states where the most individuals are due refunds while Idaho has only 6,200 people due a refund.

Nobody finds filing taxes an exciting prospect. The pain is much less, however, is you know you are due a refund. If you failed to file in 2002, you might be throwing away a nice little chunk of change.

Richard A. Chapo is with http://www.businesstaxrecovery.com - recovery of business taxes through tax help and tax relief. Visit http://www.businesstaxrecovery.com/articles to read more business tax articles.

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I am constantly amazed when I speak with people and they tell me they are still waiting for tax refund checks after six or twelve months. If you are in this position, you may be in for a surprise.

Still Waiting For Your Tax Refund?

Preparing and filing taxes is one of those things almost nobody likes to do. Much like spring cleaning, it is something to be done and then forgotten about. If you are due a tax refund, however, this can result in some problems. This is particularly true with the IRS.

Every year, the Internal Revenue Service reports that it cannot get refund checks to a large number of taxpayers. No, it does not try to hide this fact. It actually will publish news releases and contact media outlets to get the world out. This year, the IRS is trying to find almost 100,000 people that it has refund checks for. The total dollar figure for outstanding refunds is over $92 million dollars. That is almost a grand per person the IRS cannot find.

Why can’t the IRS find you? Well, there can be a variety of reasons. The most common is you have moved since filing your tax return, but did not tell the IRS. As a result, the IRS sent the refund check to your old address. Another situation that can arise occurs when a marriage happens and the IRS is not notified of any new address or name change. Contrary to what you may have heard, the IRS does not keep tabs on you every day. If you move, you have to let the agency know.

If you are still waiting for a tax refund check, you should get proactive. You can go to the IRS web site and use the “Where is my Refund?” link on the home page to find out the status of your refund. You can also pick up the phone and call the agency at 800-829-1954.

Listen, we all hate preparing and filing our taxes. If you have suffered through the process and generated a refund, don’t lose it. Take action and contact the IRS to get your money today.

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In a recent decision, a federal court overturned a telephone tax that has been charged for years. Given the result, the IRS has decided to issue refunds for past collected taxes.

IRS Sets Telephone Tax Refund Amounts

In 1898, the federal government passed a law assessing taxes on long distance phone use in the United States. The tax was so relatively small, ranging from one to three percent, that it was never questioned. Last year, that changed. The tax was challenged in court and found to be invalid. After a few challenges, the IRS agreed to stop collecting the tax. It even went so far as to agree to issue refunds on some of the taxes collected.

Given the fact the 1898 law covers just a bit of time, the issue of telephone tax refunds is potentially a complicated one. Simply put, how do you figure out how much tax you have paid on phone bills for this specific assessment through the years? At one to three percent, it certain is not much. Further, how do you prove the tax payments if you are audited? Anyone have phone bills from 1898? Probably not. In truth, the refund amount only looks back 41 months, but you get the idea.

To overcome these issues, the IRS is proposing a flat rate refund for taxpayers. The refund amounts are proposed to be $30 to $60 depending on specifics. More importantly, taxpayers will not be required to dig through old phone bills to substantiate the deduction. To claim the tax refund, you will need to fill in a yet undeclared area on your 2006 tax return. Just to be clear, this is the return you should file on April 2007.

So, how do you figure out how much you can claim as a refund? The refund amounts are being tied into the number of exemptions you claim. The standard amounts are $30 for a person filing a return with one exemption, $40 for two exemptions, $50 for three exemptions and $60 for four or more exemptions. If you are single and claim one exemption, the refund amount will be $30. If you wish to go through your phone bills and claim the exact amount of tax you paid as a refund, you also have this option.

Given the fact businesses tend to use long distance telephone services more, there is no standard deduction amount. The IRS is playing around with ways to come up with a set amount, but most believe businesses will have to dig through their phone bills to calculate the correct amount. Businesses simply vary too much to come up with universal numbers.

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