Late Filed Refunds

Today Barry from Richmond, VA is upset because he got a letter from IRS refusing to give him his refunds. “Is there any way to file for and get tax refunds for years that are past the ‘3 year refund limit’?”

Dear Barry

You can file a claim for refund, asking IRS to waive the 3 year statute for cause, if you didn’t file because:

1) You were ill all that time and just recovered. (Note: illness includes addictions, like drugs and alcohol.)

2) You were incapacitated somehow and unable to file or function.

3) You died, and your heirs are just now finding out that returns weren’t filed. (Probably acceptable to IRS – not a great option for you.)

4) Someone very close to you was ill and you had to spend all your time caring for them, to the neglect of your own affairs.

5) All your records were lost or destroyed in some major casualty (fire, theft, earthquake, tornado…) and you’ve been diligently working to reconstruct them all this time. (Note: if your income was primarily via W-2 and dividends or interest, and your expenses consisted primarily a mortgage and property taxes, there’s no excuse. You can get those documents in no time. )

You’re getting the general idea.

I’ve run up against this many times. And here’s what I’ve learned about IRS’s perspective on this issue – if you were able to work, get your wages, run your business, earn a living and show other signs of high-functioning, you don’t have an acceptable argument.

IRS will simply say, you were able to do your job, you could have filed a tax return.

Now, that doesn’t mean I wouldn’t send IRS a letter begging them to help me find a way to get the money back. If you can write a great letter, play on the reader’s sympathy and/or sense of humor, you just might get someone to help you. Probably not…unless you fall under the general guidelines above.

Good luck!

You’ll find links to all kinds of tax information whenever you need it at TaxMama.com

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