The Internal Revenue Service (IRS) has issued a cautionary alert to taxpayers across the United States, indicating that more than $1 billion in unclaimed refunds may be at stake. Approximately 940,000 individuals have until May 17 to file tax returns for the 2020 tax year, with the total unclaimed refunds exceeding $1 billion nationwide.
The average median refund for the 2020 tax year stands at $932. States with the highest number of potentially eligible individuals for these refunds include Texas (93,400), California (88,200), Florida (53,200), and New York (51,400).
IRS Commissioner emphasized the urgency of the situation, stating, “We want taxpayers to claim these refunds, but time is running out for people who may have overlooked or forgotten about these refunds. There’s a May 17 deadline to file these returns, so taxpayers should start soon to make sure they don’t miss out.”
For those who need to file a return, the IRS recommends requesting necessary documents such as W-2, 1098, 1099, or 5498 forms from their employer or bank. Alternatively, taxpayers can order a free wage and income transcript using the “Get Transcript Online” tool on IRS.gov.
Typically, taxpayers have a three-year window to file and claim tax refunds; otherwise, the funds revert to the U.S. Treasury. While the deadline for claiming old refunds usually aligns with the April 15 tax deadline, this year, the deadline for 2020 unfiled returns was extended to May 17 due to the COVID-19 pandemic.
It is crucial to note that if taxpayers have not filed returns for the 2021 and 2022 tax years, any 2020 refunds would be withheld until filings for those subsequent years are completed to ensure no outstanding liabilities.
IRS Commissioner Werfel urged individuals to review their records promptly, emphasizing the importance of not missing the May deadline. Tax season commenced on January 29, with over 71.5 million individual tax filings submitted to the IRS thus far.
For more comprehensive coverage of the ongoing tax season, visit AP’s tax season coverage.
