Time is Running Out for 2002 Tax Returns

Posted on 25. Feb, 2006 by in Taxes

taxrefund.jpg2002? Yup, I said 2002. You see, the IRS is kind enough to provide most taxpayers with a three-year window of opportunity for claiming a refund. If no return is filed to claim the refund within three years, the money becomes property of the U.S. Treasury. So, if you’ve realized that you should have deducted that office expense or should have itemized instead of taking the standard deduction, you’ve got until April 17th to amend.

In fact, the IRS reported this week that 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 Internal Revenue Service announced today. However, in order to collect the money, a return for 2002 must be filed with an IRS office no later than April 17, 2006.

The IRS 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.”

By failing to file a return, individuals stand to lose more than refunds of taxes withheld or paid during 2002. 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.

If you do need to file you can find the appropriate forms on the IRS Website. Good luck, and happy refund hunting!

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