IRS Deadline Nears for $1.5 Billion in Tax Refunds

Taxpayers have less than two weeks to claim for tax refunds for the calendar year 2019 or risk losing their rebate, the IRS has said, warning that "time is running out" before the U.S. Treasury assumes control of the $1.5 billion in overpaid taxes.

In an announcement on Friday, the federal tax agency said that there were nearly an estimated 1.5 million U.S. citizens across the country who were owed refunds and who had yet to claim. They have until July 17 to file the necessary paperwork—a week from Monday.

The deadline for the 2019 tax year was delayed due to the coronavirus pandemic—the last full year before a national health emergency was declared.

"Time is running out for people owed a tax refund in 2019," Danny Werfel, IRS commissioner, said in a statement.

He added: "The IRS continues to urge people who may have overlooked filing during the pandemic to act quickly before they lose their final chance to claim a potentially substantial refund."

The IRS said that many low and medium-income workers could be eligible for as much as a $6,557 rebate, while the average across all those still yet to claim was around $893.

The expected number of claimants by state appears consistent as a proportion of the total population, with the largest number in California—144,700 individuals, owed a combined $142 million—followed by Texas, with an anticipated 135,300 claimants owed a combined $142 million as well.

The state with the highest median potential refund was New Hampshire, with its 6,900 possible claimants expected to receive an average refund of $974, followed by averages of $966 for Massachusetts and $959 for West Virginia.

Taxpayers usually have three years in which they can file and claim tax refunds, before those unclaimed funds become the property of the Treasury. However, for 2019 this period was extended due to the pandemic.

On April 10, U.S. President Joe Biden officially declared the COVID-19 emergency over, meaning many governmental functions returned to normal, such as the resumption of student loan repayments.

Those who have yet to file a claim for a refund may need personal tax documents dating from 2019 as part of their filing.

"Taxpayers can request copies of tax documents from employers and other sources like loan service providers," Kathy Pickering, chief tax officer for Kansas City, Missouri-based tax preparation firm H&R Block, told CNBC.

She advised that some of those documents may have been provided electronically and "are still available on demand."

For those who are unable to get the necessary documents from their employer, the IRS offers a free tax transcript service online, which it says is "by far the quickest and easiest option."

However, the IRS warned that those seeking a rebate for their 2019 taxes may have their refund checks held if they had yet to do the same for 2020 and 2021 as well.

Newsweek approached the IRS via email for further comment on Tuesday.