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6 July 2020 / Tax Tips

2016 Tax Return: File Now or Forever Hold Your Peace...

6 July 2020 > Tax Tips

With the tax deadline right around the corner, many Americans will be using these final few days to ensure they file on time and receive their refunds. For many, the priority was on filing their 2018 and 2019 taxes to ensure they receive their stimulus check and any possible future stimulus packages. However, many have possibly overlooked that this is the last year to file their 2016 tax return and still be eligible for their 2016 tax refund. 

The Internal Revenue Service (IRS) has announced that about 1.4 million Americans are eligible for a refund but did not file a tax return for the year 2016. This comes out to more than $1.5 billion in unclaimed refunds, with the median coming out to $861. Taxpayers have three years to file and still be eligible for a refund. However, as you know, you can't get a refund without filing. This means that taxpayers who haven't filed their 2016 will be leaving their cut of the $1.5 billion of unclaimed returns on the table if they don't file before the July 15th Extended Filing Deadline. Any 2016 refunds not claimed by July 15th will become the property of the U.S Treasury. Let's face it, given the current events, this money could be very beneficial. The top 5 states with the most taxpayers who have not filed in 2016 are Texas, California, Florida, New York, and Pennsylvania.

There is no penalty for filing late if you are getting a refund, but keep in mind that for those who are not compliant or have not filed their 2017 or 2018 tax returns, the IRS may hold your refund. If you owe money or have unpaid federal debt, your 2016 refund could be applied to what you owe. Anyone who does not have their income information from 2016 can visit the IRS website and use their "Get Transcript Online" tool to get their reported income for 2016. Unfortunately, filing older returns may not be allowed electronically on certain platforms, so anyone filing a return for years prior to 2019 will have to mail in the completed return unless they file using registered tax preparers with the Modernized e-File System available. The return must have the proper address and be postmarked by July 15th to meet the deadline. 

Need help getting your 2016 taxes filed in time? Worry not, Taxfyle can help you on the fly! Even with an imminent deadline, you can get connected instantly with a licensed tax professional that'll help you decide the best solution for you, whether you're an individual filer or filing for your business. Don't leave money on the table and get started today!

Sara Vallejo

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