Who wouldn’t grab an income tax refund if they had one coming?
About 940,000 people, it turns out — because they haven’t filed returns for the 2020 tax year, even though they may be due money back for that year. But there’s still close to a month left to file and collect the refunds. The Internal Revenue Service estimates that the typical refund for the people in this group is more than $900.
“There’s money remaining on the table for hundreds of thousands of people who haven’t filed 2020 tax returns,” the I.R.S. commissioner, Daniel Werfel, said in a statement. The deadline for most people to file a return and collect the refunds, which total about $1 billion, is May 17.
Potential refunds range from a typical amount of $761 in Idaho to more than $1,000 in New York and Pennsylvania, the I.R.S. said. (Actual amounts vary depending on the filer’s tax situation.)
Some people may simply have forgotten to file a 2020 return because of “extremely unusual situations” during the pandemic, Mr. Werfel said. Still, said Eric Smith, an I.R.S. spokesman, the number of taxpayers potentially due a refund this year for 2020 is not at a record level. Last year, which was the three-year deadline to file and collect unclaimed refunds from the 2019 tax year — returns that were initially due in the depths of the pandemic in 2020 — nearly 1.5 million people were potentially due refunds, typically about $800.
The I.R.S., too, was affected by the pandemic. The agency struggled to process paper tax returns and correspondence, though the I.R.S. has “virtually eliminated our backlog of unprocessed paper returns” for individual returns, Mr. Smith said.
If you don’t file a 2020 tax return by the cutoff, you’ll lose the refund — and the Treasury Department keeps it. “Why leave that money on the table?” said Tom O’Saben, director of tax content and government relations with the National Association of Tax Professionals.
