Legal Question in Tax Law in Michigan

Re: refund error

You must return the money to the IRS. The Service will probably discover the error at some point and send you a notice. No interest on erroneous refunds of less than $50,000 will be charged if the money is returned within 30 days of the date of the notice demanding the repayment if the error was the IRS's fault. IRC 6532(b) gives the IRS two years to initiate a suit seeking the recovery of the money (or an unlimited time if the erroneous refund was induced by fraud or misrepresentation). If you haven't deposted the check, you should return it to the IRS by certified mail with a letter explaining their error. If you have deposited it, you can subtract the portion to which you are entitled and send the IRS a check for the balance, again by certified mail with an appropriate explanation.