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IRS: You have 2 days to get your share of $1.5 billion in unclaimed refunds

Americans who did not file a 2016 tax return have collectively left $1.5 billion unclaimed. This week, that money becomes property of the U.S. Department of Treasury.

Twenty/20

Some 1.4 million American taxpayers could miss out on thousands of dollars if they don't act fast. 

Americans who did not file a 2016 tax return have collectively left $1.5 billion worth of income tax refunds unclaimed, according to the IRS. In a matter of days, that money will become the property of the U.S. Department of Treasury.

"Time is quickly running out for these taxpayers. There's only a three-year window to claim these refunds, and the window closes on July 15," IRS Commissioner Chuck Rettig said in a July 1 statement on the bureau's website. 

The IRS doesn't require everyone to file a tax return. If your earnings fall under certain income thresholds, you aren't legally obligated to file a tax return. But just because you didn't have to file doesn't mean you don't have a refund waiting for you.

While the average individual income tax refund was about $3,050 in 2016, the IRS says that the median potential refund among those unclaimed is $861. But it points out that low-income workers may have been eligible for the Earned Income Tax Credit when they filed their 2016 taxes, which was worth as much as $6,269.

How to get your unclaimed refund money

You only get a three-year window from the initial tax deadline to recover an old refund before the U.S. Treasury absorbs it. So in ordinary years, Americans would only have until April 15 to make a last-minute refund claim. But because the IRS extended the filing window by three months due to the coronavirus pandemic, the deadline this year is July 15, 2020. 

To secure your share of unclaimed money, you'll need to complete a 1040 form for 2016. The form must be postmarked by July 15, 2020. Past-due returns will need to be mailed in to the IRS, meaning you can't file them online. 

To find forms for 2016, you can visit the IRS Forms, Instructions & Publications Page or you can call 800-TAX-FORM to obtain a copy. These forms include a 1040, 1040-A, and 1040-EZ. If you need to fill out additional forms in order to complete your 2016 return, you can request copies by submitting Form 4506-T, Request for Transcript of Tax Return.

There is no penalty for filing late when the IRS owes you a refund.

Why you may not be entitled to a refund

If you happen to have unpaid child support or past-due federal debts such as student loans, or if you haven't filed your tax returns for 2017 and 2018, those obligations could eat up some or all of your refund.

Filed past returns and never received an expected refund? You can check your IRS refund status here.

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