Tax refunds amounting to over $1 billion are awaiting an estimated 1 million people who still have not filed a federal income tax return for 2008.

To collect, taxpayers and preparers must file a return with the Internal Revenue Service no later than Tuesday, April 17. The IRS estimated that half of the potential tax refunds are for more than $600.

In some cases, the IRS acknowledged, people may not have filed because they had too little income in 2008 to require filing a tax return, even though they had taxes withheld from their wages or made quarterly estimated payments. In cases where a tax 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 a refund within three years, the money becomes the property of the U.S. Treasury, which could use some extra money to deal with the spiraling budget deficit.

The law requires that 2007 return be properly addressed, mailed and postmarked by April 17. There is no penalty for filing a late return qualifying for a refund.

The IRS also noted that taxpayers seeking a previously unclaimed 2008 refund may still have their refunds held if they have not filed tax returns for 2009 and 2010. In addition, the refund will be applied to any amounts still owed to the IRS, or they may be used to offset unpaid child support or past-due federal debts such as student loans.

By failing to file a return, people stand to lose more than refunds of taxes withheld or paid during 2008, the IRS noted. Some people, especially those who did not receive an economic stimulus payment in 2008, may qualify for the Recovery Rebate Credit.

In addition, many low-and moderate-income workers may not have claimed the Earned Income Tax Credit. The EITC helps individuals and families whose incomes are below certain thresholds. The thresholds for 2008 were $38,646 ($41,646 if married filing jointly) for those with two or more qualifying children, $33,995 ($36,995 if married filing jointly) for people with one qualifying child, and $12,880 ($15,880 if married filing jointly) for those with no qualifying children. For more information, visit the EITC Home Page on IRS.gov.

Current and prior-year tax forms and instructions are available on the Forms and Publications page of IRS.gov or by calling toll-free (800) TAX-FORM (800-829-3676). Taxpayers who are missing Forms W-2, 1098, 1099 or 5498 for 2008, 2009 or 2010 should request copies from their employer, bank or other payer. If these efforts are unsuccessful, taxpayers can get a free transcript showing information from these year-end documents by ordering it on IRS.gov, filing Form 4506-T, or by calling (800) 908-9946.

 

 

Individuals Who Did Not File a 2008 Return with a Potential Refund

 

State Individuals Median Potential Refund* Total Potential Refunds ($000)*
Alabama 18,400 $641 $15,738
Alaska 5,800 $641 $5,952
Arizona 29,000 $558 $24,913
Arkansas 9,600 $620 $8,152
California 122,500 $595 $112,201
Colorado 20,500 $589 $18,909
Connecticut 12,500 $697 $13,893
Delaware 4,200 $644 $3,784
Dist of Columbia 4,000 $642 $3,791
Florida 70,400 $650 $66,974
Georgia 35,800 $581 $30,661
Hawaii 7,600 $714 $8,307
Idaho 4,700 $541 $3,878
Illinois 40,800 $692 $40,712
Indiana 21,800 $664 $19,590
Iowa 10,600 $658 $9,295
Kansas 11,500 $631 $10,084
Kentucky 12,300 $640 $10,501
Louisiana 20,500 $662 $18,859
Maine 4,000 $579 $3,248
Maryland 24,600 $641 $22,591
Massachusetts 23,900 $699 $22,957
Michigan 33,300 $660 $30,903
Minnesota 15,200 $584 $12,772
Mississippi 9,900 $591 $8,254
Missouri 21,600 $593 $18,213
Montana 3,600 $599 $3,192
Nebraska 5,100 $623 $4,371
Nevada 14,500 $619 $13,381
New Hampshire 4,300 $733 $4,518
New Jersey 31,300 $716 $31,185
New Mexico 8,000 $611 $7,420
New York 60,300 $686 $61,240
North Carolina 30,800 $558 $24,997
North Dakota 2,000 $625 $1,895
Ohio 36,400 $622 $31,018
Oklahoma 16,800 $620 $14,787
Oregon 18,500 $527 $14,819
Pennsylvania 38,700 $695 $35,565
Rhode Island 3,400 $674 $3,040
South Carolina 12,200 $547 $10,158
South Dakota 2,300 $669 $2,234
Tennessee 18,400 $626 $16,130
Texas 96,200 $689 $97,057
Utah 7,800 $536 $6,676
Vermont 1,700 $647 $1,410
Virginia 30,800 $624 $28,670
Washington 29,900 $705 $32,138
West Virginia 4,300 $687 $4,068
Wisconsin 14,100 $592 $11,885
Wyoming 2,600 $773 $2,919
Total 1,089,000 $637 $1,009,905

* Excluding the Earned Income Tax Credit and other credits.