Mar 25, 2024 - Economy

IRS has $1B in 2020 unclaimed tax refunds, here's how to tell if you qualify

Illustration of an alarm clock with money spilling out as it is ringing.

Illustration: Annelise Capossela/Axios

The IRS announced Monday that almost 940,000 people across the U.S. have yet to claim their 2020 tax refund.

The big picture: There's more than $1 billion worth of unclaimed refunds that will be left on the table if people don't file their 2020 tax return before May 17.

State of play: To file a 2020 tax return, the IRS recommends taxpayers request their W-2, 1098, 1099 or 5498 from their employer or bank, or order a free wage and income transcript.

Zoom in: The average median refund is $932 for 2020, per the IRS.

  • The states with the largest amount of people potentially eligible for the refunds are in Texas (93,400), California (88,200), Florida (53,200) and New York (51,400).

What they're saying: "We want taxpayers to claim these refunds, but time is running out for people who may have overlooked or forgotten about these refunds," IRS Commissioner Danny Werfel said Monday.

  • "There's a May 17 deadline to file these returns so taxpayers should start soon to make sure they don't miss out," he added.

Zoom out: Taxpayers usually have three years to file and claim their tax refunds but there was an extension for the 2020 returns due to the COVID-19 pandemic.

  • The unclaimed money becomes the property of the U.S. Treasury.

Worth noting: 2020 refunds may be withheld if a taxpayer hasn't filed tax returns for 2021 and 2022.

  • Refunds may also be applied toward amounts still owed to the IRS or a state tax agency, the IRS said.

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