How many holiday presents could you buy with $953?
That's the average amount of the tax refund checks that were returned this year to the Internal Revenue Service because they were undeliverable.
Of course, that's an average amount. Your unclaimed check might be less, but then again, it could be more. And any amount of money would be a nice holiday gift as long as you let the IRS know where to send it.
In all, the IRS is looking for more than 115,000 taxpayers who are owed $110 million in refunds, mostly from their 2006 filings submitted earlier this year. The main reason the checks came back is simple: The taxpayers moved after filing their last tax returns and then forgot to let the IRS know their new addresses. In some cases, though, the addresses on the forms were illegible, so they bounced back to Uncle Sam.
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Whatever the reason, the IRS has money that could be yours. And it's an easily correctable situation.
Some people will be able to tell the IRS of their new addresses electronically, via the agency's refund tracking Web page, "Where's My Refund?"
Others will need to mail Form 8822, Change of Address, to the tax collector. You can either download the form from the IRS's Web site or call toll-free (800) 829-3676 (1-800-TAX-FORM) to request one.
But take one of these steps now so that the agency can issue you a replacement refund check as soon as possible. The IRS says it will take between four and six weeks after it hears from affected taxpayers to resend the misdelivered money.
If you act quickly, you might get it in time to make a difference in your Christmas shopping budget.
Even if it arrives after Dec. 25, you'll have the cash on hand to pay the credit card charges you ring up this holiday season.
Tracking down your refund
The IRS's "Where's My Refund?" Web page has become one of the agency's most popular online destinations. Now it can accept change-of-address data from some filers whose refund checks were returned to IRS.
When you go to the search page, have your 2006 return handy. To access the online refund locator you'll have to enter your Social Security number, filing status and the amount of the refund shown on your tax return. If the money has come back to the IRS, during the tracking process you will be prompted to enter your correct mailing information.
The address-update capability, however, does have a couple of limitations.
The feature is only available to filers whose returned check was originally issued within the past 12 months.
Filers who check on their refunds via the IRS's Refund Hotline at (800) 829-1954 cannot update their addresses on that phone call, even if their returned checks were issued in the last year. In these cases, phone callers will be given instructions on what steps to take next.
And if you moved and simply want to use the refund Web page to let the IRS know, or you owed taxes instead of getting a refund, you're out of luck. The online address change option is available only to filers dealing with undeliverable refund checks. In these other situations, you'll have to use the old-fashioned Form 8822 to ensure future refunds follow you to your new home.
If you can afford to wait for your refund money or are just too busy right now to be bothered with tracking down missing tax money, you can wait. Your unclaimed tax refund check will find you during the coming tax-filing season when you send in your 2007 return that lists your current, correct address.
The IRS keeps the returned check information on file and will forward the money as soon as it gets valid delivery data. However, if you file Form 8822 now, you won't have to wait until you get around to filling all those tax forms to collect your cash.
Let the IRS know ASAP
Rather than trying to track down your check or waiting until you file your next return to get your money, don't become an owed taxpayer in the first place. Make sure your return's address is correct -- whether you handwrite it on the form, type it on your computer or use a preprinted label.
When you do move, let the agency know your new address by filing Form 8822. Although the U.S. Postal Service provides the IRS with change of address updates weekly, using the IRS form to directly inform the agency of your address change is always a good move.
Other checks routinely come back because the recipient changes a last name, usually because of a marriage or divorce. Again, let the tax collector (via Form 8822), as well as the Social Security Administration, know this. Not only does such notification head off delays in processing tax returns and issuing refunds, it safeguards future Social Security benefits.
And executors should explore whether a refund check might be involved in an estate's settlement.
Collect directly
The IRS also suggests that instead of waiting for your refund via the mail, have it directly deposited into an account.
More than 61 million filers used direct deposit in 2007. Their payments (totaling nearly $164 billion) got to them faster, according to the IRS, and the method is more secure and convenient. There is no check to get lost -- or returned as undeliverable -- and there is no special trip to the bank to deposit a check.
To request direct deposit, simply follow the instructions on the refund line of your tax return. You can have a refund directly deposited regardless of which return (1040EZ, 1040A or 1040) you file.
You'll need to tell the IRS which type of account you have, the account number and the nine-digit routing number. Check with your account holder if you're unsure of the correct numbers to put here.
For the tax-filing season that starts in January, you'll once again be able to divide and directly deposit your return into up to three accounts, although that will require filing an additional form, Form 8888.
Freelance writer Kay Bell writes Bankrate's tax stories from her home in Austin, Texas, and blogs each day on tax topics on her Don't Mess with Taxes blog.
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