In case you didn’t know, there is a lot of money waiting to be claimed, and it could be yours. The Internal Revenue Service (IRS) revealed that over one million Americans have yet to file their 2021 taxes. What is the number at stake? At least $1 billion in tax refunds were distributed.
If you do the math, it comes out to an average of $781 per person. Imagine finding nearly $800 forgotten in the pocket of an old pair of pants. This is similar, but requires more paperwork.
You have until April 15, 2025 to make a move. After that date, the money will not disappear, but rather go directly to the Treasury Department’s coffers. Translation: If you don’t act now, you’ll be giving away money that could be used to pay bills, treat yourself, or save. Remember that three years may seem like a long time, but the deadline is quickly approaching.
How to claim your tax refund money, pending tax year 2021
If you haven’t filed your 2021 return, don’t worry. It isn’t as complicated as it appears. You only need the applicable Form 1040 for that year. Where can I get it? The IRS website has everything available for download. Of course, forget about doing it online; this time, print, sign, and send everything via traditional mail.
Yes, it’s just like old times. One tip: make copies of everything before sending it. You never know when an envelope will be lost or when a dog will eat your statement (the latter is exaggerated, but it’s better to be safe).
Here comes the good thing. In addition to what you already have for your normal declaration, there are two credits that could increase your final amount:
- Pandemic Recovery Credit (Recovery Rebate Credit): Remember those COVID stimulus payments? If for some reason you did not receive yours in 2021, this credit is your second chance. You just have to include it when filing your taxes for that year.
- EITC (Earned Income Credit): This is a lifesaver for low to moderate earners. Depending on your family situation (if you have children, for example), you could add up to $6,728 to your refund. Yes, almost seven thousand dollars. Is it worth checking out? Of course.
There is one more detail that you must keep in mind to receive the tax refund.
Keep in mind that even if you claim money for 2021, the IRS will require your 2022 and 2023 returns to be up to date. If you have not submitted them, your refund may be frozen until you have completed all of the necessary steps. What’s the reason? They want to ensure that you don’t owe them anything from recent years.
So, if you’re behind on current taxes, get caught up first. Consider it like bartering: you give them what you owe them (if anything), and they give you what they owe you.
Do not worry. To claim this refund, the IRS does not require that you have filed any prior returns. You will need all documentation for 2021. W-2 forms, 1099s, and deduction receipts… If you do not have them, please contact your employer or the institutions that paid you that year. If all else fails, the IRS provides free income transcripts through its website.
