Didn’t file a return in 2018? IRS has $1.5 billion in refunds, but deadline is approaching

IRS

WASHINGTON — Unclaimed income tax refunds totaling nearly $1.5 billion could await about 1.5 million taxpayers who did not file a federal tax return on Form 1040 in 2018, but the People must act before the April tax deadline, according to the Internal Revenue Service.

“The IRS wants to help people who owe repayments but have not yet filed their 2018 tax returns,” said IRS Commissioner Chuck Rettig. “But people need to act fast. By law, there is only a three-year window to claim these refunds, which ends with the tax deadline of April this year. We want to help people get those refunds, but they have to file a 2018 tax return before that critical deadline.”

The IRS estimates the midpoint of potential refunds for 2018 at $813, meaning that half of the refunds are above $813 and half are below.

In cases where a federal tax return has not been filed, the law provides most taxpayers with a three-year window to claim a tax refund. If they don’t file a tax return within three years, the money becomes the property of the US Treasury. For 2018 tax returns, the window closes on April 18, 2022 for most taxpayers. Taxpayers living in Maine and Massachusetts have until April 19, 2022. Taxpayers are required by law to address, mail, and ensure that the tax return is postmarked by this date.

The IRS reminds taxpayers requesting a 2018 tax refund that their checks may be withheld if they have not filed 2019 and 2020 tax returns. Additionally, the refund will be applied to any amounts still owing. to the IRS or a state tax agency and can be used to offset unpaid child support or overdue federal debts, such as student loans.

By failing to file a tax return, people stand to lose more than just their refund of taxes withheld or paid in 2018. Many low- and middle-income workers may be eligible for the Earned Income Tax Credit (EITC ). For 2018, the credit was worth up to $6,431. The EITC helps individuals and families whose income is below certain thresholds. The thresholds for 2018 were:

  1. $49,194 ($54,884 if married and filing jointly) for those with three or more eligible children;
  2. $45,802 ($51,492 if filing jointly) for individuals with two eligible children;
  3. $40,320 ($46,010 if married and filing jointly) for those with an eligible child; and
  4. $15,270 ($20,950 if married and filing jointly) for those without eligible children.

Returns for the 2018 tax year should be filed with the IRS center listed on the last page of the Form 1040 instruction PDF. Current and prior year tax forms (such as Forms 1040, 1040-A, and 1040-EZ for the 2018 tax year) and instructions are available at IRS.gov Forms and Publications or by calling toll-free 800-TAX-FORM (800-829-3676). However, taxpayers can electronically file returns for the 2019 tax year and later.

Taxpayers who miss Forms W-2, 1098, 1099, or 5498 for the years 2018, 2019, or 2020 should request copies from their employer, bank, or other payer. Taxpayers who cannot obtain the missing forms from their employer or other payer can order a free wage and income transcript from IRS.gov using the Get the transcript online tool. Alternatively, they can file Form 4506-T to request a transcript of wages and income.

A wage and income transcript shows data from information returns received by the IRS, such as Forms W-2, 1098, 1099, Form 5498, and IRA contribution information. Taxpayers can use the information from the transcript to file their tax return.