The Internal Revenue Service (IRS) issued a news release reminding taxpayers to submit their 2019 income tax returns by July 17, 2023, to claim their refunds. Internal Revenue Code Section 6511 provides the period in which a taxpayer may request a refund or credit:

Claim for credit or refund of an overpayment of any tax imposed by this title in respect of which tax the taxpayer is required to file a return shall be filed by the taxpayer within 3 years from the time the return was filed or 2 years from the time the tax was paid, whichever of such periods expires the later, or if no return was filed by the taxpayer, within 2 years from the time the tax was paid.

Practice Point: There is a misconception that the IRS will automatically refund an overpayment to a taxpayer, however, that is not typically the case. Indeed, you may have an overpayment sitting in an account for a specific tax year (e.g., 2020) but the IRS will not typically provide notice of the overpayment. Many times, the only way to know whether you have a credit balance on an account is to request a transcript of the account (e.g., Form 945, 1040 or 1120) for a specific tax year. It’s good practice to request a transcript for a tax year before the period outlined in IRC Section 6511 has expired. That way you can file a claim for a refund before the period expires. If you don’t, the IRS can (and routinely does) take the overpayment.

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