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Millions in undeliverable refunds

By Kay Bell · Bankrate.com
Thursday, December 1, 2011
Posted: 3 pm ET

How many Christmas presents could you buy with $1,547?

That's the average amount of tax refund checks returned this year to the Internal Revenue Service because the U.S. Postal Service couldn't deliver them.

Now Uncle Sam wants to get the cash, which totals more than $153 million, to its rightful owners, all 99,123 of them.

Yep, more than 99,000 people filed returns knowing they would get a refund and then didn't follow up when the check didn't arrive. Wow! I wish I could blow off cash, especially my own money that I overpaid the IRS, that easily.

But this isn't a new occurrence. Every year the IRS gets back tens of thousands of snail-mailed refund checks.

In some cases the checks come back because the address the taxpayer entered on the return was wrong.

Remember those admonitions to double-check your return before you send it? That means reviewing not only line entries on your 1040, but also your Social Security numbers and, as 99,123 filers are learning, your address. If you transpose your street address digits, your check will go to the wrong house.

If you're lucky, the person living there will note that it's not their mail and give it back to the post office, which will send it back to the IRS.

If you're unlucky, the incorrect recipient of your check could try to cash it.

So make sure your address is correct.

OK. Your address is correct, but your handwriting is so bad, the IRS employees couldn't decipher it and entered it into the database incorrectly. No judging here; I can't read my own grocery lists half the time! But this is just another reason for doing your taxes via software. The forms are easier to read. And if you e-file them, the data bypasses the IRS entry clerks.

Finally, sometimes people file returns and then move before they get their checks. This is a common problem with college students.

Whatever the reason for the undeliverable refunds, the money is there, just waiting to be claimed. All the IRS needs is a correct address.

If some of that $153 million is yours, go to the IRS' online tracker Where's My Refund? It will give you the status of your refund and status of their refund and, in some cases, instructions on how to resolve delivery problems.

If you prefer the telephone, call the IRS' automated refund tracking toll-free phone line at (800)829-1954.

And next year, in addition to using tax software and e-filing, consider direct deposit.

Get the latest news of tax news, tips and tax planning advice by subscribing to Bankrate's free Weekly Tax Tip newsletter.

You also can follow me on Twitter at @taxtweet.

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14 Comments
Katy Bailey
December 03, 2011 at 9:42 am

they get theres so why should'd some poor soul get whats left, my dear uncle gets all of his you know unk SAM

Moussa N. Ndam
December 02, 2011 at 11:58 pm

For the past several months the IRS has been holding more than $1,114.0 of my 2010 tax return. Their agents have been jerking me around saying that that refund was paid to an unkown company which I owed some money. They have refused to disclose the name of that company. I need help to collect that money. Please help.

Terry Sweeton
December 02, 2011 at 11:10 pm

For about 2 years they said i owed them 800 dollars,I told them to take it out of my income tax 2 years in a row.They never did take it, now im on disability and cannot afford to pay it.

laRRY Quartano
December 02, 2011 at 10:28 pm

The I>R>S> contacted me in 2007, you know how pleasant they can be. Anyway, according to their calculation's I owed them a very large amount of cash. Long story short, the year in which they wanted to know about I did not file. No taxable income, so I file one for them, Instead of me having to give them money, seems they owed me. Two weeks later I get a letter stating that it had gone beyond three years, so they were not going to pay. So, good luck, once they have it, they really dont like letting go of it.

Ted Helle
December 02, 2011 at 9:44 pm

I do believe that money could be used on, Schools,Roads,Better Lighting.

Randy K
December 02, 2011 at 9:27 pm

The article is titled "Does Uncle Sam Owe You a Tax Return?" Huh? Owe you a tax return? Who proof reads this stuff?

michael
December 02, 2011 at 9:05 pm

John: it's not theirs to "assign"...

Stephanie
December 02, 2011 at 9:04 pm

I think John has a right idea of a time frame with the exception: this country us 14 trillion in debt, and I know we as citizens shouldn't have to pay for it, but guess what? The government will raise taxes on something to get it out of us, so all the unclaimed IRS checks which no one claims...its a thought.

john e.v.
December 02, 2011 at 8:44 pm

Dear people,why not assign all lost money over a year old to the poor hurting american poor and clean our country with it=???
God Bless The U.S.A.

Dave
December 01, 2011 at 4:18 pm

Let me give you my address....