The deadline for claiming unclaimed refunds for 2020 is fast approaching, with millions still eligible to file their 2020 tax return and potentially receive a refund. It’s estimated that over $1 billion in refunds remain unclaimed, and the final date to submit your 2020 tax return is May 17.
Important Deadline for 2020 Tax Refunds
According to a recent IRS press release, around 940,000 taxpayers still have until May 17 to file their 2020 return and secure their refund, with the average refund potentially reaching $932.
Although there’s no penalty for missing the deadline, it’s crucial to act because tax refunds have a three-year expiration period after each tax deadline. This gives taxpayers a limited window of three years to file and claim their refund.
Originally, the deadline was set for April 15, but it was extended to May 17, 2021, due to the COVID-19 pandemic. In addition to the refund, taxpayers may also be eligible for COVID-related tax credits, such as the Earned Income Tax Credit (EITC) or the Recovery Rebate Credit.
Failing to file a tax return could mean missing out on more than just the refund for taxes paid or withheld during 2020. The IRS emphasizes that this estimate doesn’t include additional credits that non-filers might qualify for.
In 2020, the EITC was approximately $6,660 for those with qualifying children, and the Recovery Rebate Credit is available for those who didn’t receive one or more stimulus payments during the pandemic.
Steps to Claim Your 2020 Refund
If you haven’t yet filed your 2020 return and aren’t sure where to start, the IRS offers tools and instructions to assist you. Begin by logging into your free IRS online account to access wage and income transcripts, which include essential tax forms like W-2, 1098, 1099, and 5498.
You can also visit the IRS forms and instructions page for current and past year tax forms. Alternatively, missing tax forms can be obtained online through your bank or financial institution.
The IRS provides several other resources to help with the tax return process, including the Interactive Tax Assistant.
Before filing your 2020 taxes, consider the following:
- Ensure your tax filings are up to date. The IRS may withhold your refund if you haven’t filed your 2021 and 2022 taxes.
- Your refund could be reduced if you have outstanding tax debts or other amounts owed to state agencies. The 2020 refund may be used first to cover any unpaid debts to the IRS, child support, or other past-due federal obligations.