Nearly 11,000 Hawai‘i residents who did not file federal tax returns for the 2002 tax year are due over $13 million in refunds, or an average of over $600 per person, an Internal Revenue Service official said in a press release.
Nationally, unclaimed refunds totaling more than $2 billion are awaiting about 1.7 million people who failed to file a federal income tax return for 2002, the IRS spokesperson said.
In order to collect the money, a return for 2002 must be filed with an IRS office no later than April 17.
The IRS official estimates that half of those who could claim refunds would receive more than $570.
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.
“We want people to get the refunds they’re entitled to,” said IRS Commissioner Mark W. Everson. “We urge taxpayers to double-check their records before the April 17th deadline. Taxpayers can’t get a refund if they don’t file a tax return.” In cases where a return was not filed, the law provides most taxpayers with a three-year window of opportunity for claiming a refund, he explained.
If no return is filed to claim the refund within three years, the money becomes property of the U.S. Treasury. For 2002 returns, the window closes on April 17.
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.
The IRS spokesperson reminded taxpayers seeking 2002 refunds that their checks will be held if they have not filed tax returns for 2003 or 2004.
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 2002, Everson continued.
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, individuals qualified for the EITC if in 2002 they earned less than $33,178 and had more than one qualifying child living with them, earned less than $29,201 with one qualifying child, or earned less than $11,060 and had no qualifying child.
Current and prior-year tax forms and instructions are available on the Forms and Publications page of the IRS Web site (www.irs.gov), or by calling 1-800-TAX-FORM (1-800-829-3676).
Taxpayers who need help also can call the IRS help line toll-free at 1-800-829-1040.
According to IRS records, some 10,700 people whose known address for the 2002 tax year was Hawai‘i, are due $13,019,000 in refunds, or a median return of $611 per person.
In addition, there are 8,500 members of the armed forces due refunds of $6,995,0000 for the same year, for a median return of $749, and another 1,000 people whose 2002 tax-year addresses were U.S. possessions due refunds of $1,426,000, or a median refund of $587 per person.