Wrongful incarceration exclusion reminder: Dec. 17 is deadline for older refund claims

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Wrongful incarceration exclusion reminder: Dec. 17 is deadline for older refund claims

IR-2018-249, December 13, 2018

IR-2018-249, December 13, 2018

WASHINGTON — Wrongfully-incarcerated individuals, wishing to take advantage of the special retroactive tax exclusion, usually must file refund claims by Monday, Dec. 17, 2018, according to the Internal Revenue Service.

WASHINGTON — Wrongfully-incarcerated individuals, wishing to take advantage of the special retroactive tax exclusion, usually must file refund claims by Monday, Dec. 17, 2018, according to the Internal Revenue Service.

The income tax exclusion applies to any civil damages, restitution or other monetary award received in connection with their incarceration. This means that an eligible wrongfully-incarcerated individual can file a refund claim based on any civil damages, restitution or other monetary award received and reported on their federal income tax return for a prior tax year, even if the normal statute of limitations had already expired for that year. Without this special provision, refund claims for tax-years 2014 and earlier would be barred in most cases. The deadline for mailing a claim under this special rule is Dec. 17, 2018.

The income tax exclusion applies to any civil damages, restitution or other monetary award received in connection with their incarceration. This means that an eligible wrongfully-incarcerated individual can file a refund claim based on any civil damages, restitution or other monetary award received and reported on their federal income tax return for a prior tax year, even if the normal statute of limitations had already expired for that year. Without this special provision, refund claims for tax-years 2014 and earlier would be barred in most cases. The deadline for mailing a claim under this special rule is Dec. 17, 2018.

To take advantage of this provision, an eligible individual must file Form 1040-X for each year these payments were reported.  Be sure to write “Incarceration Exclusion PATH Act” at the top of each form. A set of frequently-asked questions, available on IRS.gov, provides details on who qualifies for the exclusion, awards that qualify and documentation and recordkeeping requirements.

To take advantage of this provision, an eligible individual must file Form 1040-X for each year these payments were reported.  Be sure to write “Incarceration Exclusion PATH Act” at the top of each form. A set of frequently-asked questions, available on IRS.gov, provides details on who qualifies for the exclusion, awards that qualify and documentation and recordkeeping requirements.

The IRS has established a special filing address for amended returns claiming the wrongful-incarceration exclusion. Send these Forms 1040-X, along with any supplemental documentation, to:

The IRS has established a special filing address for amended returns claiming the wrongful-incarceration exclusion. Send these Forms 1040-X, along with any supplemental documentation, to:

Internal Revenue Service
333 W. Pershing
Stop 6503 5th Floor
Kansas City, MO 64108

Internal Revenue Service
333 W. Pershing
Stop 6503 5th Floor
Kansas City, MO 64108

Allow up to 16 weeks for processing. In most cases, taxpayers can then use the “Where’s My Amended Return?” application on IRS.gov to track the status of their refund claims.

Allow up to 16 weeks for processing. In most cases, taxpayers can then use the “Where’s My Amended Return?” application on IRS.gov to track the status of their refund claims.

Research & References of Wrongful incarceration exclusion reminder: Dec. 17 is deadline for older refund claims|A&C Accounting And Tax Services
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