The Commercial Appeal reported yesterday afternoon that refunds totaling greater than $12.8 million may be waiting for over 16,000 Tennessee taxpayers who have not filed their 2010 income tax return, according to the Internal Revenue Service (IRS).

However, if these taxpayers wanted to collect the money, they must file with the IRS no later than April 15.

There’s no penalty for filing late if you qualify for a refund, but taxpayers seeking their 2010 refund may have their checks held if they haven’t filed returns for 2011 and 2012. The refunds will also be applied to any amounts still owed to the IRS or their state tax agency and may also be used to offset unpaid child support or past due federal debts like student loans.

Sometimes people with too small an income required to file a tax return won’t file even though they had taxes withheld from their wages or made quarterly payments. In a case like that, the law provides three years to claim a refund.

If no refund is claimed within three years, the money becomes property of the US Treasury.

If this is you, I urge you to file your return to claim your refund. It’s poor stewardship to leave money on the table with no interest payments.

On the flip side, if you’re someone who’s struggling with owing too much income tax, did you know you can discharge income tax in a bankruptcy?

To be eligible for a Chapter 7, relief taxes must be at least three years old and returns must have been filed and on time.

But if you’re someone who’s filed your income tax on time and aren’t sure how you’re going to be able to pay what you owe, just know a bankruptcy is an option. Your tax debt can be discharged through a Chapter 7 or lumped into an affordable 3-5 year repayment plan through a Chapter 13.

And the cool thing about a Chapter 13 is that it allows you to include all of your other debts. Chances are that if you’re struggling to pay your owed income tax, then you have an underlying financial problem resulting in more debt than just taxes. A bankruptcy will allow you financial breathing room so that you can tackle your spending issues and build for a better future.

A bankruptcy is just the first step towards a strong financial future, but we can help you with the next step by offering you a 14-week program called “7 Steps to a 720” that will help you re-establish and rebuild your credit the right way. This program is free for our clients.

If you have any questions or if you’re considering filing for bankruptcy, please contact us today, either online or by calling us at (901) 327-2100. One of our experienced Memphis bankruptcy attorneys will be ready to speak with you, free of charge.