Delayed IRS Refunds for Foreign Persons for 2014 and Prior Years

Hi There

I have recently learned that the IRS is delaying refunds for foreign persons.  Below is the text from their website that explains this:

Nonresident Aliens Filing Form 1040-NR for Refund of U.S. Source Income Withheld

If you requested a refund of tax withheld on a Form 1042-S Foreign Person’s U.S. Source Income Subject to Withholding by filing a Form 1040NR U.S. Nonresident Alien Income Tax Return, we will need additional time to process the return.  Please allow up to 6 months from the original due date of the 1040NR return or the date you actually filed the 1040NR, whichever is later to receive any refund due.

The link to this release is here:

In simpler terms this means that anyone who filed a return for 2014 will not have their refund processed until December 15, 2015.  That is 6 months later than the deadline for filing (which is June 15th, 2015).

If you filed for 2013 on November 15, 2014 you can expect your refund to be processed 6 months from that date (which would be Approx. May 15th, 2015).    Note that the 2013 deadline was June 15th, 2014.  And the IRS statement above says to allow “6 months….whichever is later to receive any refund due”

The math is similar for 2012.

This is an unfortunate development for US Tax Refunds for Canadians who win money in the USA which can likely be attributed to the US governments’ lack of financial resources.  There are several articles on the internet that state that the US government services will be compromised due to budget cuts.

On the positive side if the CDN dollar continues to weaken you will be earning a handsome rate of return on your withholdings.

Feel free to call me or email me with specific gambling winnings tax questions.

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