Last week, the Internal Revenue Service sent out information about nearly $150 million in undeliverable tax refunds owed to nearly 100,000 American taxpayers.
People love stories like that. Only in America can people find out they’ve got a little pot of cash that they didn’t know about waiting for them.
The IRS, though, wasn’t interested in talking about the excitement of free money awaiting a small fraction of the so-called 99 percent. It wasn’t particularly interested in talking about why it couldn’t find these 100,000 or so people.
Instead, it was pitching the fact that people really should file their tax returns electronically. On the IRS website, I was told by IRS spokesman Luis Garcia, there are 18 kinds of tax preparation software available for free.
Taxpayers who file paper forms and mail them to the IRS might have to wait six to eight weeks to get their refunds, but the 79 percent who file electronically and have their refund deposited directly into their bank account can get their refunds in as little as six days, Garcia said.
Plus, when you file electronically, you have to enter your address more than once, reducing the chance that you will accidentally get your address wrong. All in all, it makes life easier for the IRS, and it makes things move faster when you file your taxes by computer, Garcia said.
OK, so the IRS has gotten to make its please-file-electronically pitch.
Now, why are all these tax refunds undeliverable?
Garcia says the IRS officially has no idea why. The IRS has only anecdotal evidence of what the problem is, Garcia said.
People’s lives undergo changes, he said. They get married, they get divorced, they move, they get evicted. Some taxpayers are students who move from season to season and have constantly changing addresses. The result is that when the IRS sends someone a refund check at an address where he no longer lives, the check isn’t forwarded. It is returned to the IRS.
People make mistakes on their tax returns, too, Garcia said. People do make simple math errors, but sometimes they make errors even more basic than that. They might actually get their address wrong on their return. Hard to believe, but it happens.
What I wanted to know was how many people around here have unclaimed tax refunds. Garcia told me that in Indiana there were 1,147 Hoosiers owed refunds, and the average refund size was $890.
Garcia even provided me with a list of 83 taxpayers in Adams, Allen, DeKalb, Huntington, Noble and Whitley counties who are owed money by the government. I checked some of the names in the newspaper’s archives and it appears those owed money include a senior citizen who likes to run, a local artist and a youth pastor, among others.
Sadly, my name wasn’t on the list.
There are ways to go to the IRS website and claim your refund. Even if you do nothing, the money will probably come to you eventually. For example, if you file your taxes next year, the IRS will note if it owes you money and add it to your refund or subtract it from what you owe.
But why wait? Who couldn’t use a few extra bucks during the holidays?