How Long Can an Applied Refund Be Left With the IRS?

You must file a tax return in order to claim a refund.

If the IRS owes you a refund, you have up to three years to claim it. You must file a tax return for the year you are claiming the refund and all subsequent years.

Statute of Limitations

There is no penalty for filing a late return if a refund is owed to you. You have up to three years after the filing deadline to claim a refund. For example, a tax return for 2007 was due by April 15, 2008. However, if the IRS owes you a refund for 2007, you must file and claim your refund by April 15, 2011. You must also file returns for every year since.

Tax Liability

The IRS first applies a refund to any outstanding tax liability. Your refund may also be applied to past-due child support, debts to another federal agency or past-due state income taxes.

State and Local Taxes

You can apply a refund of prior-year state or local taxes as a credit to your current state or local tax due. You can only apply a prior credit if you did not actually receive a refund.

References

• Internal Revenue Service: IRS Has $1.2 Billion for People Who Have Not Filed a 2004 Tax Return
• Internal Revenue Service: Publication 17, Chapter 22

Resources

• Internal Revenue Service: FAQ For Past Due Return Filers
• Internal Revenue Service: Publication 556