Did you know refunds expire 3 years after the due date (plus extensions) of the tax return?
Understanding the Statute of Limitations:
Generally, taxpayers face a statute of limitations when they can file a claim for refund of overpaid taxes in any particular year. This limitation runs for three years from the original due date of your tax return, or two years from the date you the tax due, whichever is later (IRC Section 6511(b)). In most cases, the statute of limitations does apply to both federal and state refunds. However, it’s best to consult a qualified tax professional regarding your individual circumstances. There are specific exceptions to the three-year limitation if taxpayers claim a refund as a result of a bad debt, worthless security, NOL carryback, etc. The IRS may also postpone the refund deadline due to a Presidentially declared disaster.
A typical example is as follows:
2022 Individual return is filed by the April deadline (4/18/2023). An amended return must be filed by 4/18/2026. If the amended return is received later than 4/18/2026, the Internal Revenue Service will acknowledge the refund, but the refund is forfeited/expired.
COVID impact:
As the 2019 return deadline (4/15/20) occurred in the early days of the COVID-19 pandemic, the Treasury Department and Internal Revenue Service provided special tax filing relief to individuals and businesses by extending the deadline from April 15 to July 15, 2020. This means taxpayers have until July 17th, 2023 (July 15th is a Saturday which moves the deadline to the next Monday), can file an original (or amended) 2019 return for a refund. Any 2019 return received after July 17th, 2023 will forfeit any refund.