Most often than not, it is the Internal Revenue Service that is seeking money from taxpayers. A notice may be sent that says a tax payer owes x-dollars in unpaid taxes, interest and penalties after an audit. In a rare situation, a recent report was released that the IRS is currently holding $917 million dollars due to taxpayers across the country — and the window for claiming it is quickly closing.

The situation affects those who did not file their 2009 federal tax return. There are several reasons why someone may not have done so, including the fact that they may have earned income that placed them below the filing requirement. However, many of those individuals might not realize that taxes were still withheld from their paychecks and that they may be eligible for a refund.

According to the report, there are around 984,000 people who may be eligible for a refund. We are not talking about a small sum here. In fact, approximately 50 percent of those refunds are worth $500 or more. More surprising to many people is the fact that when eligible for a refund, there is no penalty for the failure to file the return.

Let us not forget that the federal tax code is a complicated set of statutory sections and a number of rules will apply to the request for a refund. For example, there is a three-year window to request the refund. For 2009, that filing deadline is April 15, 2013. Failure to request it in time would result in forfeiting the money that would simply go into the U.S. Treasury. Other requirements would include filing 2010 and 2011 tax returns.

Source: KING-5, “IRS may owe you hundreds from 2009,” Travis Pittman, March 19, 2013

Whether a taxpayer has been told that they owe money or believes that it is instead the IRS or Minnesota Department of Revenue that owes, our Minneapolis law firm handles cases involving a tax dispute.