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) has just revealed that more than one million people in the United States have yet to file their 2021 taxes.
What is the number at stake? Nothing less than $1 billion was distributed in tax refunds. 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.
The important thing to remember is that you have until April 15, 2025 to take action. 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
Don’t worry if you haven’t filed your 2021 tax return. It isn’t as complicated as it appears. You only need the 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 stuff. In addition to what you already have for your standard declaration, there are two credits that could increase your total 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.
Be careful: even if you’re claiming money for 2021, the IRS will require you to have your 2022 and 2023 returns 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. Of course, you will need all of the 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.
