On April 15, 2026, the IRS permanently closed the books on an estimated $1.2 billion in unclaimed refunds from tax year 2022. That money now belongs to the U.S. Treasury. The people it belonged to, roughly 1 million taxpayers who never filed a return, will never see a dime of it. It was the third year in a row the IRS watched a billion-dollar pool of refunds expire, and the same thing will happen again in April 2027 unless taxpayers who skipped their 2023 returns act first.
Three consecutive years, three billion-dollar forfeitures
The IRS publishes estimates each spring showing how much money is about to vanish, and the numbers have been strikingly consistent:
- Tax year 2020: About 940,000 taxpayers were owed a collective $1 billion in refunds, with a median refund of $932. The deadline, extended to May 17, 2024, because of pandemic-era relief, has passed.
- Tax year 2021: More than 1.1 million people were owed over $1 billion, with a median refund of $781. That window closed April 15, 2025.
- Tax year 2022: An estimated $1.2 billion went unclaimed. The window closed April 15, 2026.
In each case, the pattern was the same: employers withheld federal income tax from workers’ paychecks, but the workers never filed a return to claim what was owed back to them. The refunds sat in limbo until the statutory clock ran out.
The federal law behind the hard cutoff
The deadline is not an IRS policy choice. It is written into 26 U.S. Code Section 6511, which gives taxpayers exactly three years from a return’s original due date to file and claim a refund. If a return would have been due April 15, 2023, the refund expires April 15, 2026. No exceptions, no appeals, no late-filing workaround.
The IRS has been direct about this in its public guidance: once the three-year window closes, the refund becomes “property of the U.S. Treasury.” Even if a taxpayer later finds old W-2s or 1099s proving taxes were withheld, the money is gone.
“People hear ‘you don’t have to file if you’re under the threshold’ and stop listening,” said Mark Steber, chief tax information officer at Jackson Hewitt Tax Services, in a May 2026 interview. “What they miss is that ‘don’t have to’ and ‘shouldn’t’ are two very different things. If your employer withheld taxes, the only way to get that money back is to file.”
The only recent wrinkle involved tax year 2020. Congress pushed that year’s filing deadline to May 17, 2021, as part of pandemic relief, which shifted the three-year expiration to May 17, 2024. Every other recent tax year follows the standard April 15 calendar.
Who loses out and why
The people most likely to forfeit a refund are often the ones who need it most. Tax practitioners and advocacy organizations like the Taxpayer Advocate Service have long noted that non-filers tend to fall into a few overlapping groups:
- Low-wage and part-time workers who earn below the standard deduction threshold and assume they have no reason to file. If their employer withheld federal tax, they are wrong.
- Young adults in first jobs and college students who do not realize a tax return is how they get withheld money back.
- Gig workers and freelancers paid through platforms that issue 1099 forms but offer little tax guidance.
- People experiencing housing instability who never receive W-2s or IRS notices mailed to old addresses.
- Immigrants and non-native English speakers who may distrust government paperwork or not know the system well enough to file.
One enrolled agent in Houston, Maria Gonzalez, described a client she helped in early 2026 who had not filed since 2020. “She was a home health aide making about $28,000 a year. Her employer withheld federal taxes every paycheck, but she never filed because she thought she didn’t make enough to owe anything,” Gonzalez said. “When we ran the numbers, she was owed over $3,400 just for 2023, including the Earned Income Tax Credit. She had no idea.”
That anecdote points to another layer many non-filers miss entirely. Some would have qualified for refundable credits, specifically the Earned Income Tax Credit (EITC) or the Additional Child Tax Credit, that pay out even when no federal tax was withheld. For a qualifying family, the EITC alone can be worth several thousand dollars. Without a filed return, those credits are never calculated, which means the true value of what these taxpayers left behind is likely higher than the IRS’s median estimates suggest.
How to claim a refund before the next deadline hits
If you skipped filing for tax year 2023, you have until April 15, 2027. For tax year 2024, the deadline is April 15, 2028. Here is how to start:
- Pull your wage and income records. Request a free Wage and Income Transcript through your IRS Online Account, or mail Form 4506-T. The transcript shows every W-2, 1099, and other income document reported under your Social Security number for a given year.
- File on paper. Prior-year returns generally cannot be e-filed. Download the correct year’s Form 1040 and instructions from the IRS prior-year forms page, complete the return, and mail it to the processing center listed in that year’s instructions.
- File every missing year, not just one. The IRS can hold a refund from one tax year if you have unfiled returns for other years. Submitting all outstanding returns at once reduces the chance of a freeze on your refund check.
- Consider free filing help. The IRS Volunteer Income Tax Assistance (VITA) program offers free tax preparation for people who generally earn $67,000 or less. Some VITA sites will help with prior-year returns. Use the IRS VITA locator to find a site near you.
- Do not wait until the last week. Transcript requests can take days or weeks to process, and the return must be postmarked by the deadline. Give yourself at least a few months of lead time.
“The biggest mistake I see is people assuming they’ll get to it next year,” said Steber. “Next year becomes the year after, and then the three-year window closes. I tell every client: pull your transcript today, even if you don’t sit down to file for another month. At least you’ll have the documents ready.”
A note on penalties and state refunds
A common fear among non-filers is that submitting a late return will trigger penalties or an audit. In most cases, the IRS does not impose a late-filing penalty on returns that show a refund, because the penalty is calculated as a percentage of unpaid tax. If you owe nothing, the penalty is zero. That said, if you earned income in multiple years and owe tax for some of them, filing all your missing returns at once could surface a balance due for a different year. Consulting a tax professional or a VITA volunteer before filing can help you understand the full picture.
It is also worth checking whether your state has its own unclaimed refund. Most states with an income tax follow a similar use-it-or-lose-it rule, though deadlines and procedures vary. Your state’s department of revenue website is the best starting point.
The clock is already running on 2023
Three billion-dollar piles of refunds have now expired in three consecutive years. The IRS has not yet released its estimate for unclaimed 2023 refunds, but based on the pattern, another billion-dollar forfeiture is likely unless more taxpayers file before April 15, 2027. The return itself is the only thing standing between a non-filer and their money. For anyone who skipped 2023 or 2024, the window is still open, but it will not stay open forever.
