The U.S. Treasury currently owes $1.3 billion to taxpayers for overpaid taxes on their 2006 tax return? It’s important because the deadline to file a tax return for 2006 is April 15th, 2010. After that date, those taxpayers are no longer entitled to their refund. With money as tight as it is, you might be pleasantly surprised at what you, or someone you know, could get if you didn’t file in 2006.
Why would someone due a tax refund not file a return? Simple, it’s not uncommon for someone to see that their income falls below the filing requirements (usually you’re in the first or second federal income tax brackets) and just skip it because they’re too busy or think they wouldn’t get a refund. However, if you’re working and your employer is withholding taxes, you are probably due one. 2006 was the year of the telephone excise refund, which was free money in your pocket if you filed, and you could have qualified for a refund that way.
I think that it’s always worth it to prepare a return to see if you were due a refund. Online tax preparation tools like TurboTax will let you prepare your return for free (and even file it for free if you satisfy certain requirements) to see if you’re due a refund. If you are, file, if not, you just spent a little bit of time knowing for sure. Last year, the average tax refund was over $2,600, you owe it to yourself to spend an hour preparing them (which is about how long it should take if you’re situation is simple enough that you’re considering not filing in the first place).
Some additional caveats:
Jim normally tackles fun personal finance topics like this one at Bargaineering.com.