IRS has $1 billion in unclaimed tax refunds from 2020. Here's how to claim your share.
We all had a lot going on during the pandemic, so if filing your taxes fell by the wayside, you may have a pleasant surprise in store.
The Internal Revenue Service announced Tuesday that almost 940,000 people across America have unclaimed refunds for tax year 2020, totaling more than $1 billion.
If you're one of those folks, you have until May 17 to submit your tax return and claim your refund.
In New Jersey, it's estimated that 24,400 people may be entitled to an unclaimed tax refund, with the median refund sitting at $920. That means more than $27 million could await taxpayers in the Garden State.
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“There’s money remaining on the table for hundreds of thousands of people who haven’t filed 2020 tax returns,” IRS Commissioner Danny Werfel said in a news release. “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.”
Typically, taxpayers have three years to file their returns and claim tax refunds, but due to the COVID-19 pandemic, the window was extended for 2020 returns to May 17, 2024. If tax returns aren't filed within the time period, the money becomes property of the U.S. Treasury.
“People faced extremely unusual situations during the pandemic, which may have led some people to forget about a potential refund on their 2020 tax returns,” Werfel said. “People may have just overlooked these, including students, part-time workers and others. Some people may not realize they may be owed a refund. We encourage people to review their files and start gathering records now, so they don’t run the risk of missing the May deadline.”
The IRS added that people may lose more than just their refund of withheld taxes. For instance, many low- and moderate-income workers may be eligible for the Earned Income Tax Credit, which in 2020 worth as much as $6,660.
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If you haven't filed your tax returns for 2021 or 2022 yet, though, any 2020 funds may be held. Any refund amount for 2020 also will be applied toward any amount owed to the IRS or any tax agency, used to offset unpaid child support or used for other federal debts, such as student loans.
How to file a past year's tax return
You can find current and prior year tax forms and instructions at the IRS.gov Forms and Publications page or by calling toll-free 800-TAX-FORM (800-829-3676).
If you need help gathering information needed to file a past tax return, the IRS offers the following tips:
Request copies of key documents: Taxpayers who are missing Forms W-2, 1098, 1099 or 5498 for the years, 2020, 2021 or 2022 can request copies from their employer, bank or other payers.
Use Get Transcript Online at IRS.gov. Taxpayers who are unable to get those missing forms from their employer or other payers can order a free wage and income transcript at IRS.gov using the Get Transcript Online tool. For many taxpayers, this is by far the quickest and easiest option.
Request a transcript. Another option is for people to file Form 4506-T with the IRS to request a “wage and income transcript.” A wage and income transcript shows data from information returns received by the IRS, such as Forms W-2, 1099, 1098, Form 5498 and IRA contribution information. Taxpayers can use the information from the transcript to file their tax return. But plan ahead — these written requests can take several weeks; people are strongly urged to try the other options first.
This article originally appeared on Asbury Park Press: Internal Revenue Service says unclaimed 2020 tax refunds total $1B
