IRS Owes 24K NJ Residents Millions In Tax Refunds: Here's How To Claim

NEW JERSEY - The IRS owes tens of thousands of New Jersey residents money from 2020, but people need to act fast to make sure they don't miss out on their unclaimed cash, agency officials said last week.

In all, New Jersey residents are owed more than $27 million in unclaimed tax refunds from 2020.

The IRS said earlier this year that nearly a million people nationwide haven't claimed their refunds for the 2020 tax year. That includes 24,400 New Jersey residents owed $27,408,300, according to the IRS.

Every year, IRS officials say, about $1 billion to $1.5 billion in refunds goes unclaimed, compared with about $300 billion in refunds paid.

"We want taxpayers to claim these refunds, but time is running out for people who may have overlooked or forgotten about these refunds," IRS Commissioner Danny Werfel said.

Under federal law, taxpayers normally have three years to file and claim their tax refunds until that cash becomes the property of the U.S. Treasury.

But the deadline was extended for 2020 returns due to the pandemic — taxpayers now have until May 17 to claim 2020 refunds, according to the IRS.

"People faced extremely unusual situations during the pandemic, which may have led some people to forget about a potential refund on their 2020 tax returns," Werfel said. "People may have just overlooked these, including students, part-time workers and others. Some people may not realize they may be owed a refund. We encourage people to review their files and start gathering records now, so they don't run the risk of missing the May deadline."

The median amount of the unclaimed New Jersey 2020 refunds is $930, the IRS estimates.

In addition to making sure the money goes back into one's pocket, taxpayers have another reason to make sure they complete their 2020 returns, the IRS says.

Low- and moderate-income workers may be eligible for the Earned Income Tax Credit — which was worth as much as $6,600 for taxpayers with children in 2020.

Those who need to file their 2020 returns should request their W-2, 1098, 1099 or 5498 from their employer or bank, or order a free wage and income transcript with the IRS' Get Transcript Online tool, the IRS said.

Further instructions are available at the IRS website or by calling 800-829-3676.