Did you know that there's a statute of limitations on tax refunds? That's right, if you're due a refund, you have three years from the date your return was due to claim it. After that, the IRS can keep your refund.
Now, you might be thinking "But wait! I didn't even file my return! Surely, if I didn't file, there's no way the statute of limitations could apply." Unfortunately, that's not the case. If you don't file a return or otherwise claim a refund, the IRS has no way of knowing that you're owed a refund. As a result, the three-year clock starts ticking as soon as your return is due.
So what happens if you try to claim a refund after the statute of limitations has expired? The IRS isn't required to issue you a refund check, and they can apply any overpayments (including overpayments of estimated or withholding taxes) to other tax years that are underpaid. In other words, if you're owed a refund for one year but owe taxes for another year, the IRS can offset your refund against your tax liability and send you a bill for the balance.
The bottom line is this: if you're due a refund, make sure to file your return or otherwise claim your refund within three years of when it was due. Otherwise, you risk losing your refund entirely. And remember, even if you don't file a return, the IRS still has up to six years to assess and collect any taxes you owe. So even if you think you might owe taxes, it's always better to file sooner rather than later.