Deadline to claim $1 billion in tax refunds nears – do you qualify?

(NEXSTAR) – A crucial deadline is coming later this month for some taxpayers who may be owed their share of an estimated $1 billion in refunds, the Internal Revenue Service announced.

Taxpayers who did not file their tax year 2020 returns may be eligible to collect a refund if they file by May 17, and there's no penalty for failure to file if a refund is due.

To get a refund, however, the return must reach the IRS within three years of the due date. The cutoff is later this year because in 2020 COVID-19 delayed the filing deadline beyond mid-April.

This year's deadline marks the last chance for taxpayers to not only claim old refunds, but also any owed tax credits. Taxpayers who may have overpaid the government or withheld too much will also miss out on a refund check or the chance to apply the balance to other tax years.

Don't forget about tax credits

Taxpayers who didn't file in tax year 2020 won't just miss out on a potential refund, according to the IRS, but any credit they might qualify for.

Not included in the $1 billion estimate are the Earned Income Tax Credit, which could be worth as much as $6,660 for lower income workers with qualifying families, and the Recovery Rebate Credit – a refundable credit for those who did not receive one or more of the stimulus checks sent out during 2020 and 2021.

If you want to beat the May 17 deadline, the IRS encourages taxpayers to start as quickly as they can, as it will take some time to track down the necessary documents from employers, banks or other payers.

A free wage and income transcript can be ordered at IRS.gov. Not sure whether or not you need to file a return? See additional guidance from the IRS.

Which states are owed the most?

The IRS broke down the estimated amount owed to taxpayers by state, and found that Texas tops all others at $107,130,200, followed by California ($94,226,300) and Florida ($58,210,500)

See the IRS website for more.