Individuals Are Due $1.5 Billion in 2019 Federal Income Tax Refunds

On June 8, the IRS issued IRS News Release IR 2023-112 in which they encouraged nearly 1.5 million individuals living throughout the US to submit a 2019 federal income tax return by the July 17, 2023 filing deadline.

These individuals have not yet filed their 2019 federal income tax returns. The IRS estimates that nearly $1.5 billion in refunds remain unclaimed because individuals who are due these refunds have not yet filed their 2019 federal income tax returns.

Specific information about these 2019 federal income tax refunds is available on the IRS website here. IRS News Release IR 2023-112 includes a state-by-state estimate of how many individuals are potentially eligible for these refunds, as well as each state’s median potential refund. The average median refund for tax year 2019 was $893.

The tax filing deadline for 2019 federal income tax returns was originally April 16, 2020. But as a result of the COVID-19 pandemic national emergency that started on March 13, 2020, the IRS extended the 2019 tax filing deadline to July 17, 2020.

The three-year deadline to file 2019 federal income tax returns in order to claim refunds was therefore extended to July 17, 2023. IRS Notice 2023-21 (issued on February 27, 2023) provided legal guidance on claims made by the postponed filing deadline. The law requires individuals to properly address, mail and ensure the tax return is postmarked by July 17, 2023. It should also be noted that 2019 federal income tax returns cannot be filed electronically and must be filed via paper returns.

Three important items with respect to filing 2019 federal income tax returns:

1. If an individual has not filed a 2019 (or earlier) federal income tax return and has a balance due, then there is no statute of limitation for filing. The return must be filed no matter how far back the original filing deadline.

2. Since the states with state income taxes followed the federal government lead in extending the 2019 filing deadline, individuals who live in one of the many states that have a state income tax also need to file a 2019 state income tax return by the July 17,2023 deadline in order to receive their 2019 state tax refund.

3. If an individual did in fact file their 2019 federal tax return by July 17, 2020, then the deadline for amending the return in order to receive a refund is also July 17, 2023. On the other hand, if an amended 2019 federal income tax return has to be filed in order to correct an error and there is a balance due, then there is no state of limitation for filing an amended 2019 federal (or state) income tax return.

The IRS also reminds individuals seeking a 2019 federal income tax refund that their refund checks may be delayed if they have not filed tax returns for 2020 and 2021. In addition, the refund will be applied to any amounts still owed to the IRS or a state tax agency and may be used to offset unpaid child support or past due federal debts such as student loans.

Prior year tax forms (including tax year 2019 Forms 1040 and 1040SR) can be found here, and instructions are available online on the IRS Forms Instructions and Publications page here, or by calling the IRS toll-free 800-829-3676.

Obtaining Key Documents to File 2019 Income Tax Returns

In order to file 2019 tax returns, individuals will need their 2019 tax information documents including Form W-2, 1099s, 1098s, 5498s and IRA contribution information. Individuals filing 2019 returns should immediately begin to obtain these information documents to ensure they will have enough time to prepare their returns and to file before the July 17,2023 deadline for 2019 refunds. Here are three options to obtain the tax information documents:

1. Request copies of key documents directly from the document issuers. Individuals who are missing Forms W-2, 1098, 1099 or 5498 for the years 2019, 2020 or 2021 should request copies from their employers, banks, credit unions, brokerages, mortgage companies, or other document issuers.

2. Use Get Transcripts Online at www.irs.gov. Individuals who are unable to obtain those missing tax information documents from their employers or other issuers can order a free wage and income transcript from the IRS using the Get Transcript Online tool here. This is by far the quickest and easiest option.

3. Another option is for an individual to file Form 4506-T (Request for Transcript of Tax Return), in order to request a “wage and income” transcript showing data from informational returns received by the IRS. This includes Forms W-2, 1099, 1098, 5498 and IRA contribution information.

Individuals can use the information from the transcript to file their tax return. Note that since these are written requests to the IRS, it can take several weeks to receive the transcripts. With a filing deadline of July 17, 2023 (less than one month away) in order to receive a refund, this is not the best option for obtaining key tax documents.