March 26th 2024.
The Internal Revenue Service, also known as the IRS, recently sent out a serious warning to taxpayers all across the United States. In a statement released by The Associated Press, the IRS revealed that there is a possibility of over $1 billion in unclaimed tax refunds that have yet to be claimed. This news comes as the May 17 deadline for tax returns for the 2020 tax year is fast approaching, and the IRS is urging approximately 940,000 individuals to take immediate action.
The average median refund for the 2020 tax year is estimated to be around $932, and the states with the largest number of potentially eligible recipients include Texas, California, Florida, and New York. In order to stress the urgency of the situation, IRS Commissioner Danny Werfel stated, "We want taxpayers to claim these refunds, but time is running out...taxpayers should start soon to make sure they don't miss out."
Werfel also emphasized the importance of reviewing tax records promptly in order to avoid missing the deadline. He noted that some individuals may not even realize that they are owed a refund. Since tax season began on January 29, the IRS has already received over 71.5 million individual tax filings this year.
For those who still need to file their tax returns, the IRS recommends obtaining important documents such as W-2s, 1098s, 1099s, or 5498s from their employers or banks. Alternatively, taxpayers can use the "Get Transcript Online" tool on the IRS website to request a complimentary wage and income transcript.
Typically, the deadline for filing tax returns is April 15, but this year it has been extended to May 17 due to the ongoing COVID-19 pandemic. While this may offer a brief respite, it's important to note that failing to file tax returns for the 2021 and 2022 tax years may result in the 2020 refunds being withheld until those obligations are met.
According to CNET, some taxpayers may have had a portion of their refund redirected towards outstanding debts, including federal and state taxes, unemployment compensation, child support, spousal support, or other federal obligations like student loans. In the event that you were expecting a refund for the 2021 tax year but did not receive it when filing your previous tax return, it's possible that your refund was offset.
The IRS is responsible for overseeing these refund offsets related to overdue federal taxes, and if you are affected by this, you can expect to receive a notification from the agency explaining the offset. It's important to stay updated and informed in order to avoid any surprises when filing your taxes.
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