Federal government will keep unclaimed tax refunds

The federal government owes money to a lot of Californians who didn’t file their income tax returns a few years ago. And as KPCC’s Debra Baer tells us, if they don’t claim what’s theirs, the government gets to keep it.

The federal government owes money to a lot of Californians who didn’t file their income tax returns a few years ago. And as KPCC’s Debra Baer tells us, if they don’t claim what’s theirs, the government gets to keep it.

Debra Baer: Basically, the rule says that if you overpaid what you owe in taxes and are due a refund, but you don’t file a tax return – perhaps because you didn’t make very much – you have three years to file a claim or give up your right to the money.

In 2005, the IRS says, 154,000 state residents had other things to do than file their tax returns. So, the federal treasury has been holding onto $144 million of their money. The median refund amount is $537 – meaning half the checks would be bigger and half smaller.

Some were seniors who had part-time jobs, and others maybe were college students working summer jobs. Whoever they were, they have until Wednesday at midnight to mail a 2005 1040 tax form – or it becomes the property of the U.S. Treasury.