1,000 million hopes for 1.1 million taxpayers. Confused? Well, it was a poetic attempt to start talking about how the Internal Revenue Service (IRS) reported that $1,025,336,800 in tax refunds for the 2021 period remain unclaimed.
More than 1.1 million people could recover an average that can range from $781 to $897.75. The filing deadline is April 15, 2025, after which the funds will become the property of the U.S. Treasury.
Who can claim these tax refunds? Almost any taxpayer
The beneficiaries are taxpayers who did not file their Form 1040 for 2021 but overpaid taxes or qualify for refundable credits, such as the Earned Income Tax Credit (EITC). The latter can be up to $6,728 for eligible people with dependent children. IRS studies indicate that many are unaware of their right, especially low-income workers, students or temporary employees.
Lack of information and geographic mobility are some of the factors that have prevented millions of American citizens from receiving their refunds. People who changed addresses without notifying the IRS may not receive notices. In addition, there is a mistaken belief that low income exempts you from filing a return. However, the IRS emphasizes that even those who earned less than the required minimum must do so to access credits like the EITC.
Average and median: two sides of tax refunds
While the average refund is around $897.75, the median of $781 reveals an uneven distribution. This gap suggests that some amounts are significantly high, possibly due to additional credits. For example, in New York the median is $995, compared to $600 in California, a variation attributed to differences in income and state policies. But there is a difference between “average” and “median” when it comes to tax refunds:
Average:
The average, or arithmetic mean, is calculated by adding all the values in a set of data and dividing the result by the total number of values. It is a measure that considers each individual value and can therefore be influenced by extreme or outlier values.
Median:
The median is the value found in the center of a set of data when the data is ordered from smallest to largest. Unlike the average, the median is not affected by extreme values, since it only considers the midpoint of the distribution. This makes it a more robust measure in situations where the data is not uniformly distributed.
Claim your refund TODAY, or say goodbye forever
The IRS published state tables detailing eligible individuals and estimated amounts. This data excludes credits such as the Recovery Rebate Credit, which would increase totals if claimed. Organizations like Volunteer Income Tax Assistance (VITA) offer free help to make the process easier, especially in underserved communities.
If the funds are not recovered before 2025, the federal Treasury will absorb them. Experts warn that this would affect vulnerable households, since the EITC reduces poverty by 5 million children annually, according to the Congressional Budget Office. The IRS encourages you to verify eligibility using online tools such as Should I File? on its official portal.
Taxpayers must complete the 2021 Form 1040, available on the IRS website, and attach documents such as W-2, 1098 or 1099. Those who do not have them can request them from employers or use the Get Income Transcript tool. Late declarations do not generate fines if there is a balance in favor, but delays could complicate collection.
