About 900,000 Americans are missing out on valuable funds because they have not yet claimed their 2020 tax refund.
Taxpayers have until May 17 to file their requests to recover more than $1 billion in unclaimed refunds, the Internal Revenue Service announced.
There is normally a three-year window to claim refunds before the cash becomes the property of the US Treasury.
In previous years, the normal filing deadline to claim old refunds fell around the same time as the federal tax deadline, which was April 15 of this year for 2023 returns. But an extension was granted for refunds of 2020 due to the Covid-19 pandemic.
The average median refund for 2020 is $932, according to the IRS, but this varies by state, with some typical payments as high as $1,031.
The IRS provided details on which states are owed the most in 2020 tax refunds. All states are owed, but Texas residents are owed the most: more than $107 million.
IRS Commissioner Danny Werfel said March 25 that nearly 940,000 U.S. taxpayers have unclaimed funds from the 2020 tax year; that figure has now decreased slightly.
According to the IRS, Texans are owed the largest amount of total refunds, with an estimated 93,400 residents owed $107,130,200 in refunds.
The state-by-state breakdown calculated by the agency shows that California has the second-highest amount of potential refunds, with $94,226,300 owed to 88,200 people.
New York is in third place, with a debt of $60,837,400 owed to 51,400 residents.
The IRS predicts that 53,200 Floridians could still be owed more than $58 million, while 38,600 people living in Pennsylvania could be left with $43,412,900 in unclaimed cash.
Pennsylvania residents also receive the highest average payment at $1,031, followed closely by New Yorkers at $1,029.
“There is money left on the table for hundreds of thousands of people who have not filed 2020 tax returns,” Werfel said in a statement.
“We want taxpayers to claim these refunds, but time is running out for people who may have overlooked or forgotten about these refunds.”
Werfel added that the “extremely unusual situations” many faced during the pandemic could have led them to forget about a potential refund on their 2020 tax returns.
‘People may have simply overlooked them, including students, part-time workers and others. “Some people may not realize that they may be owed a refund,” he stated.
Everyone hoping to receive these 2020 funds this year must meet certain requirements.
The IRS confirmed in a March 4 announcement that most taxpayers who were U.S. citizens or residents in the respective year are eligible.
However, anyone who meets that qualification must also not be a dependent of another taxpayer and have a social security number issued before the tax return due date.
2020 funds can also be claimed for someone who died that year or later.
But it is important that people can submit their applications efficiently and correctly.
The 2020 funds the IRS is referring to are from the Covid Era Recovery Rebate Credit
The IRS reminded taxpayers in its recent statement that there are ways to get their forms before the May deadline.
Taxpayers who are eligible for 2020 refunds are encouraged to begin the process of filing those returns early.
To do so, tax filers should request copies of 2020 documents as soon as possible.
‘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,’ the IRS said on its website.
For those who can’t get those forms from their employer or other payers, they can simply request a free wage and income transcript through the IRS’ Get Transcript Online tool.
The agency noted that taxpayers who wish to file a Form 45-6-T with the IRS must request a transcript of wages and income.
That transcript will show data from information returns received by the IRS, such as W-2s and 1099s.
Although requests for these transcripts may take several weeks, they will provide the information necessary to file a tax return.