What explanation will help recover my late 2003 tax return from IRS' Statute of Limitations 3-year-max-law?

Question

My 2003 income tax was incomplete and needed to be filed by April 15th, 2007 but I didn't get around to filing it until late May/early June because I didn't have the fee for HR Block. IRS says I don't owe(am due a refund) but that the Statute of Limitations Law allows me to file up to 3 years late, and I was 3 months over(so, they're holding it)... I talked to an IRS attendant & she gave me the address to write to the IRS Service Center/collections. She suggests that I don't just say that I forgot or that I didn't know, b/c "ignorance of the law is no excuse", as she stated. So now the IRS is holding my return money from that year, but I really need it asap. ARE THERE ANY EXCEPTIONS TO THAT LIMITATIONS LAW which I could use in my letter. It was an honest mistake but it doesn't give them the right to keep my hard earned money. Some1 plz help ASAP. Maybe you know of the limitations laws and can enlighten me on what would possibly work?? Maybe my situation alone was good enough?

Answer 1

About the only way that anything would work, was if you were physically unable to file the 2003 within the 3 year deadline (you were in a coma, you were held hostage). Saying that you didn't have the H&R Block fee is not good enough. I do know the limitations laws, and am sorry to have to inform you that you are out of luck with claiming the refund. The only way out that I can think of is if you had filed for an extension (and you would have had to file a 2nd extension as well) for the 2003 return. If you had filed an extension, that would have extended the filing of the 2003 return originally to August 15, 2004 (which considering that today is 8/23 you'd be out of luck), and if you had filed for a 2nd extension (giving 2 additional months) that would have extended the filing to October 15, 2004, which would extend the 3 years to file to October 15, 2007. If you didn't file an extension or only filed the first extension, I'm sorry but you are out of luck totally, unless you were in the coma or held hostage for 3 years (maybe H&R Block held your return hostage until you paid them, but that doesn't count).

PS, not sure what M is suggesting to write off for 2008 (should be 2007). If it's the tax prep fee, that needs to be claimed on Schedule A - Itemized Deductions under miscellaneous deductions, and has to exceed 2% of AGI for the excess to be deductible. If M is suggesting to write off the lost refund, you can't do that.

Answer 2

From the information that you have provided your only hope is the "procrastination defense". It never works!
The only general exception is for a "Financially Disabled" person (see page 18 of Pub 17, link to follow). There are a number of specific exceptions most of which have to do with the government causing you to be unable to file on time. None of those would apply to your circumstances. By the way you really had until April 17th, 2007.

Answer 3

Tax law is one of my main interests. You have three years to file. No more, no less. If you can't get it done in that amount of time there is really nothing you can do. You could say that you forgot or didn't know, but as a citizen it's your job to be informed so the IRS will hear your story but you still won't be able to file. As for the return, you won't get that back so just write it off on your 2008 taxes.. it's just a write off though. Like I said, you won't get the money back.
You don't have to go through H&R Block, you could always buy Turbo Tax or do your taxes yourself.

There are no exceptions or limitations and your situation isn't one that would warrant sympathy. Make sure next time that you get them done.

Also, I'm not sure, but don't you have to pay a fee when filing taxes late? I don't know. I've never filed late. Next time don't wait until you need the money to file.

A statute of limitations is what it is... if they let you do it then everyone could do it and there would be no purpose for the law. Follow the law next time.

Answer 4

The IRS will consider waivers on that on a case by case basis. I know a few military folks who have been approved due to a heavy deployment load going back to the Balkans.

Long-term hospitalization may also work, as would serious mental illness.

Be prepared to document the reasons for your delay. The GIs that I worked with had to provide copies of all of their TDY orders. If you're claiming hospitalization or mental illness, have proof ready as the IRS will want to see it.

If you just procrastinated for 3 years then there's little chance that they'll entertain your request.