In order to protect your tax refunds now and in the future, you need to know the top 5 reasons the IRS may take your tax refund. Please read the list below:

1. You missed the due date - The IRS has a statue of limitations on claims for refunds. Any claim for a tax refund must be made within three years of the due date of that return; otherwise, that refund is permanently gone. For example, if you did not file your tax refund by April 15, 2015 then you have until April 15, 2018 to file that return and receive a refund.

2. You owe back taxes from a previous year - Things can get ugly, fast when you're in debt to the IRS with mounting penalties and interest incurred on top of your prior tax liabilities. Among the various collection measures it has at its disposal, the agency can seize your tax refund and apply it to any balance due.

3. You owe another branch of the government - The Treasury Offset Program uses taxpayers' refunds to pay off their debts to other federal and state government agencies. The number one use of this program is to pay down delinquent student loan debt, but it can be also applied to outstanding child support or state income taxes.

4. You are in bankruptcy - If you are in Chapter 7 or 13 bankruptcy proceedings, then the trustee will petition to have some or all of your tax refund to pay off your debts. Once all debts are successfully discharged, then the trustee can not take your future refunds.

5. You missed filing a tax return - If you failed to file a tax return in prior years, then the IRS may hold any future refunds until the late or missing return is filed. If you are found to owe back taxes, then they will likely apply the refund they are holding to that. If no tax liability, then you will get your refund once they process the late return.

If you are not sure or concerned about your past, current, and future tax liabilities, then please contact us today for a brief consultation and a free estimate. Our tax debt resolution team of Enrolled Agents, Certified Public Accountants, and Tax Attorneys are here to meet your personal and business needs. Thank you and have a great day!

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