Filing past due tax returns before the refund statute date expires

Published: April 8, 2022 | Last Updated: February 8, 2024

TAS Tax Tip: Filing Past Due Tax Refunds Before the Refund Statute Date Expires

File a Claim for Credit or Refund

Did you know that in general, you must file a claim for credit or refund of any tax within three years from the time “the return” was filed, or two years from the time the tax was paid, whichever period expires later? It’s true, and you may lose out on a credit or refund if you don’t file a timely claim. A properly filed original or amended income tax return can serve as a claim for credit or refund.

Refund expiration date

When a taxpayer files a claim for credit or refund, it must be filed by a particular date called the refund statute expiration date (RSED). Again, generally, you must file a claim for a credit or refund within three years from the date you filed your original tax return or two years from the date you paid the tax, whichever is later (often referred to as the three-year/two-year rule). Once you determine if your claim was timely, the law imposes limits as to how much the IRS can credit or refund, depending on whether you filed within the three-year rule or the two-year rule. If you filed within the three-year rule, your credit or refund will be limited to amounts paid within the three years prior to the filing of the claim plus the period of any extension of time for filing your original return. If, however, you filed within the two-year rule, your credit or refund will be limited to the tax you paid within the two years immediately before you filed the claim.

There are numerous exceptions to the general three-year/two-year RSED. For example, a longer RSED exists for claims involving bad debts, worthless securities, or net operating loss carrybacks. In addition, periods where you are experiencing financial disability may suspend the time limitation for filing a claim for credit or refund. For more information on exceptions and periods of financial disability, see Pub. 556, Examination of Returns, Appeal Rights, and Claims for Refund.

See our NTA Blog: Claims for Refunds: 2019 and 2020 Tax Year Trap for the Unwary for specific issues that may also affect the RSED for tax years 2019 and 2020.

See also, IRS’s reminder about 2018 tax returns with refunds. For 2018 tax returns, the RSED window closes April 18, 2022, for most taxpayers.

Filing past due tax returns

Filing past due federal tax returns is important for reasons other than just the potential for losing out on a credit or refund. Those include:

Protecting Social Security benefits
Avoiding issues when obtaining loans
Preventing the IRS from filing a tax return for you

So, be aware of the consequences for not filing a tax return when you are required to do so.
If you need resources to help you file a tax return, see:

If you need return preparation assistance with a prior year tax return and the IRS has already contacted you about that return, you may be available for assistance from a Low Income Taxpayer Clinic.

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For more updates from the Taxpayer Advocate Service, visit the news and information center to read the latest tax tips, blogs, alerts and more.