Uncle Sam might owe you more money than expected. But you'll have to act fast to snag it.
The IRS said Wednesday that it is currently holding $1 billion in unclaimed tax refunds for an estimated 1 million taxpayers who did not file a 2013 federal income tax return. The median anticipated refund varies by state (see chart below), with estimates ranging from $619 (Idaho) to $917 (Alaska).
"Students and many others may not realize they're due a tax refund," IRS Commissioner John Koskinen said in the announcement.
IRS regulations don't require a federal tax return for people whose income is less than a set level, depending on filing status, age and the type of income received. But those taxpayers may still benefit from filing, to get back any federal income tax withheld from a paycheck or claim any refundable tax credits.
Taxpayers typically have three years from the point that return was due to file and claim their refund. After that, funds become the property of the U.S. Treasury. So to grab any money owed, you'll have to file that 2013 return by this year's tax deadline of April 18.
(That's not necessarily an easy feat if those years-old necessary tax documents aren't safely stashed in a shoebox somewhere. You can ask your employer for copies of previous W2s or use the IRS Get Transcript tool to request wage and income information from those years.)
It really is free money: There are no penalty fees for filing your return years late if the government owes you, and not the other way around.
However, the IRS did caution taxpayers that the 2013 refund could be held if the taxpayer hasn't filed returns for 2014 and 2015, either. And if you owe any other tax bills to the IRS or the state, or are behind on child support or federal student loans, the refund could be siphoned to offset those debts.
Source: SOURCE: IRS. Total potential refunds does not include the Earned Income Tax Credit and other credits.