February 16, 2000
Taxpayers Must File Soon to
Claim $2 Billion in 1996 Refunds
WASHINGTON - The Internal Revenue Service estimates that nearly 1.6 million people
who paid taxes but failed to file returns for 1996 risk losing about $2 billion in refunds if they
don't get their late returns to the IRS by April 15, 2000.
The law generally provides for refunds only if taxpayers file returns within three years of
the filing deadline, said IRS Commissioner Charles O. Rossotti. We want people to get the
refunds they deserve, but they have to file tax returns in order to claim them.
IRS researchers found that as of January 1999, these taxpayers still had not filed the
returns that were due in 1997. Some may have filed them since then. If the returns aren=t at the
IRS by April 15, 2000, the taxpayers lose their right to the money. It is not enough for the returns
to be mailed by then -- the law requires that the IRS receive the returns by that date in order to
refund taxes withheld or paid during 1996.
If a taxpayer has not filed returns for 1997 or 1998, the IRS will hold any 1996 refund due
until it also has returns for those years. The refund would be reduced by any amounts still owed
for other years, as well as by unpaid child support or certain federal debts, such as student
loans. There is no penalty for filing a late return qualifying for a refund, since the penalty would
be based on any unpaid tax.
By not filing returns, people may lose more than refunds of taxes withheld or paid during
1996. Many eligible 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 their tax,
those who file returns more than three years late would be able only to offset their tax. They
would not be able to receive refunds if the credit exceeded their tax.
For 1996, workers could claim the EITC if their incomes were less than $28,495 and they
had two qualifying children, less than $25,078 and they had one qualifying child, or less than
$9,500, if they had no child and were at least age 25 and under 65.
The IRS Web site at www.irs.gov has forms for prior years as well as the current tax year.
Taxpayers may also request the forms by calling (toll-free) 1-800-TAX-FORM (1-800-829-3676).
Those who need help preparing prior year returns or gathering income records may call the IRS
at 1-800-829-1040. Taxpayers should request either forms or help by mid-March, to allow time
for processing before the April deadline.
The following are IRS estimates, by state, of the numbers of taxpayers who
have not filed for potential refunds for the 1996 tax year.
Nonfilers (000s) Potential Est. Refunds
Alabama 23,600 $22,796
Alaska 7,800 $9,542
Arizona 29,900 $32,075
Arkansas 13,800 $11,720
California 174,800 $417,587
Colorado 26,600 31,302
Connecticut 18,900 27,471
Delaware 5,200 $4,577
District of Columbia 6,900 $9,923
Florida 103,800 $156,665
Georgia 57,600 $53,076
Hawaii 10,900 $11,853
Idaho 5,600 $5,799
Illinois 69,100 $89,001
Indiana 31,700 $32,514
Iowa 14,700 $11,825
Kansas 16,900 $14,051
Kentucky 15,800 $17,311
Louisiana 24,300 $26,321
Maine 5,000 $9,208
Maryland 32,900 $35,136
Massachusetts 36,400 $61,423
Michigan 65,900 $75,168
Minnesota 21,300 $19,608
Mississippi 12,500 $11,999
Missouri 30,300 $28,384
Montana 3,900 $3,222
Nebraska 7,700 $7,869
Nevada 17,000 $23,396
New Hampshire 5,500 $7,778
New Jersey 52,800 $74,264
New Mexico 9,200 $8,625
New York 102,700 $154,104
North Carolina 44,200 $39,507
North Dakota 2,500 $2,091
Ohio 48,500 $53,140
Oklahoma 20,900 $17,376
Oregon 22,800 $22,780
Pennsylvania 50,300 $67,205
Rhode Island 5,100 $5,307
South Carolina 17,400 $17,052
South Dakota 2,900 $2,361
Tennessee 23,400 $27,560
Texas 119,100 $141,570
Utah 9,700 $10,948
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