IRS: Hawaii has $5.4M in 2010 unclaimed tax refunds

The Internal Revenue Service says more than $5.4 million in tax refunds have gone unclaimed in Hawaii.

The IRS says the money is potentially due to 6,200 Hawaii residents who did not file a federal income tax return for 2010. In order to collect those refunds, a 2010 return must be filed and postmarked no later than Tuesday, April 15. There is no penalty for filing a late return qualifying for a refund.

The IRS says some people may not have filed because they had too little income to require filing a tax return even though they had taxes withheld from their wages or made quarterly estimated payments. In cases where a return was not filed, the law provides most taxpayers with a three-year window of opportunity for claiming a refund. If no return is filed to claim a refund within three years, the money becomes property of the U.S. Treasury.

Checks for taxpayers seeking a 2010 refund may be held if they have not filed tax returns for 2011 and 2012. In addition, the refund will be applied to any amounts still owed to the IRS or their state tax agency, and may be used to offset unpaid child support or past due federal debts such as student loans.

By failing to file a return, the IRS says people stand to lose more than just their refund of taxes withheld or paid during 2010. In addition, many low-and-moderate income workers may not have claimed the Earned Income Tax Credit (EITC). For 2010, the credit is worth as much as $5,666.

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