IRS Issues Final Reminder for $1B in Unclaimed Refunds—Are You Eligible?

1.1 million people in the U.S. have unclaimed refunds for tax year 2021.

In a news release, the IRS announced that more than 1.1 million people in the U.S. have unclaimed refunds for tax year 2021—but the deadline to claim them is April 15, 2025.

"The IRS estimates that more than $1 billion in refunds remain unclaimed by taxpayers who have not filed their Form 1040, Federal Income Tax Return, for the 2021 tax year," the release states. "The IRS estimates the median refund amount is $781 for 2021."

By law, if the refund is not claimed by this three-year mark, it becomes the property of the U.S. Treasury. A 2021 tax refund could be held by the IRS if one has not paid their 2022 or 2023 taxes. "In addition, any refund amount for 2021 will be applied to amounts still owed to the IRS or a state tax agency and may be used to offset unpaid child support or other past due federal debts such as student loans," the IRS states.

You could also be eligible for 2021's EITC—up to nearly $7,000.

The IRS is also reminding those who may not have filed their 2021 tax returns that they could be eligible for the Earned Income Tax Credit (EITC), which helps low- and moderate-income individuals and families qualify for a tax break. "For 2021, the EITC was worth as much as $6,728 for taxpayers with qualifying children," they state. The income thresholds for 2021 were:

• $51,464 ($57,414 if married filing jointly) for those with three or more qualifying children;
• $47,915 ($53,865 if married filing jointly) for people with two qualifying children;
• $42,158 ($48,108 if married filing jointly) for those with one qualifying child, and;
• $21,430 ($27,380 if married filing jointly) for people without qualifying children.

• Have earned income
• Have investment income below the limit
• Have a valid Social Security number by the due date of your return (including extensions)
• Be a U.S. citizen or a resident alien all year
• Not file Form 2555, Foreign Earned Income
• Meet certain rules if you are separated from your spouse and not filing a joint tax return

RELATED: IRS Is Cracking Down on Outstanding Taxpayer Claims: "Deeply Concerned."

How to file a 2021 tax return:

If you believe you could be owed a refund from 2021, the IRS lists four ways to gather the information needed to file your return:

1. Log in to or create an Individual Online Account at IRS.gov, where you can find transcripts of past tax returns, tax account information, wage and income statements, and verification of non-filing letters
2. Request copies of key documents such as Forms W-2, 1098, 1099, or 5498 from your employer, bank, or "other payers"
3. Use Get Transcript by Mail on IRS.gov or call 800-908-9946 to request a transcript be mailed to you
4. File Form 4506-T with the IRS to request a wage and income transcript, which "shows data from information returns received by the IRS, such as Forms W-2, 1099, 1098, Form 5498 and IRA contribution information." Do note this can take several weeks.

4. Remember, you can use IRS Free File and Direct File to complete your taxes.

If you're still looking to get your 2024 taxes in by the April 15 deadline, the IRS offers two free ways to complete your taxes:

1. IRS Direct File: A step-by-step web service that allows people in 25 U.S. states to prepare their federal and state tax returns directly with the IRS.
2. IRS Free File: A free tax preparation software via a public-private partnership with the IRS that's available to those with a 2024 adjusted gross income (AGI) of $84,000 or less.

• Volunteer-led free tax help for families earning less than 67,000 annually, people 60 years of age and older, the disabled, and people who speak limited English
• MilTax, a Department of Defense program offered to all military members and some veterans