The IRS might have a gift for you

If you can afford to wait for your refund money or are just too busy right now to be bothered with tracking down missing tax money, you can wait. Your unclaimed refund check will find you during the coming tax-filing season when you send in your 2007 return that lists your current, correct address.

The IRS keeps the returned-check information on file and will forward the money as soon as it gets valid delivery data. However, if you file Form 8822 now, you won't have to wait until you get around to filling all those tax forms to collect your cash.

Let the IRS know ASAP

It's better to avoid all this trouble, of course. Make sure your return's address is correct -- whether you handwrite it on the form, type it on your computer or use a preprinted label.

When you do move, let the agency know your new address by filing Form 8822. Although the Postal Service provides the IRS with change-of-address updates weekly, using the IRS form to directly inform the agency of your address change is always a good move.

Other checks routinely come back because the recipient changes a last name, usually because of a marriage or divorce. Again, let the tax collector (via Form 8822), as well as the Social Security Administration, know this. Not only does such notification head off delays in processing tax returns and issuing refunds, it safeguards future Social Security benefits.

And executors should explore whether a refund check might be involved in an estate's settlement.

Collect directly

The IRS also suggests that instead of waiting for your refund to arrive in your mailbox, have it directly deposited into a bank account.

More than 61 million filers used direct deposit in 2007. Their payments, totaling nearly $164 billion, got to them faster, according to the IRS, and the method is more secure and convenient. There is no check to get lost or returned as undeliverable, and there is no special trip to a bank to deposit a check.

To request direct deposit, simply follow the instructions on the refund line of your tax return. You can have a refund directly deposited regardless of which return (1040EZ, 1040A or 1040) you file.

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You'll need to tell the IRS which type of account you have, the account number and the bank's nine-digit routing number. Check with your account holder if you're unsure of the correct numbers to put there.

For the tax-filing season for 2007, you'll once again be able to divide and directly deposit your return into up to three accounts, although that will require filing an additional form, Form 8888(.pdf file).

This article was reported and written by Kay Bell for Bankrate.com.

Published Dec. 31, 2007

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