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Your Last Chance to Get Past Due IRS Stimulus Checks

Elite Personal Finance

Last Update: March 24, 2025 • Financial News •

Did you know you may be owed hundreds of dollars from the IRS meant to be collected years ago?

American consumers can still redeem their $1,400 stimulus check from the COVID-19 relief program if they’ve never filed a 2021 tax return. More than 1 million people are eligible, and they have until April 15th to submit their tax returns. The US government is estimated to owe roughly 1 billion dollars. Not including stimulus checks, the IRS projects the median refund amount to be $781.

By state, California, Texas, and New York have the most significant number of eligible taxpayers qualifying for the refund.

What are the IRS Refund Rules?

Generally, any American taxpayer qualifies for a refund if you overpaid on your taxes for the last annual year (too much withheld from your paycheck). If you haven’t filed your tax return in past years, you may also be able to claim your refund as long as it fits within the IRS’s look-back window.

If you are a relatively low-income earner, you may qualify for the Earned Income Tax Credit (EITC), Child Tax Credit (CTC), or American Opportunity Tax Credit (AOTC). The EITC alone is worth up to $7,430 (2023).

To be eligible for a refund, you must file your tax return by April 15th of every year unless it falls on a weekend or holiday, in which case you would pay on the following business day. Exceptions are granted if there are extraordinary circumstances, such as COVID-19, which extended the time to file a tax return to May 17th, 2024.

Remember you typically see refunds issued to your checking account or designated account within 21 days for electronically filed returns versus 6 to 8 weeks for paper returns. That’s why we recommend that you electronically file using free tax preparation services or paid ones like TurboTax and H&R Block, which apply IRS-approved calculations to maximize your refund based on information entered during every step of the filing process.

What Does the IRS Do to Collect Unpaid Taxes?

There are many ways the IRS can enforce payment of taxes.

The first step is to issue payment demand letters, which contain all information on unpaid debt, including the amount owed and any assessed penalties and interest, as well as instructions on how to pay it off.

If taxes remain unpaid, the IRS reserves the right to file a federal tax lien, which places a legal claim against your property. Not only are your assets at risk, but your credit score can also be damaged, affecting your ability to take out other lines of credit (e.g., auto loans, mortgages) or sell or refinance your property.

Other IRS enforcement actions include implementing levies on your property or wages, redirecting a percentage of your earned paychecks, and directing money to the IRS no matter who your employer is. Future tax refunds could also be risky, and even passport revocation is at hand.

To avoid this, we recommend paying off your debt as soon as possible or participating in an installment agreement that allows you to pay your debt via manageable monthly or quarterly payments. Suppose you’re facing tough financial hardship. In that case, you may take advantage of the Offer in Compromise program, which allows you to settle on a payment less than the actual amount owed based on eligibility criteria such as your proven ability to pay, income, expenses, asset equity, and other considerations.

Remember that the IRS only accepts 24% of all submitted Offer in Compromise applications. For the best chances of success, we recommend consulting with a tax law attorney.

What Happens to Unclaimed Refunds?

If you do not claim your refund within the IRS’s three-year window, then the US Treasury—keeps your money with no possibility of recovery. From 2020 on, it was estimated that the IRS gained over 1 billion in unclaimed refunds.

In addition, you have to be mindful of state-specific refund rules. For example, Texas and Florida do not require state income tax, whereas New York offers state-specific tax credits like the Empire State Child Credit, which can increase your refund amount even more. There are also separate policies by state regarding unclaimed property refund filing, which may or may not include state tax refunds.

How Do I Check My Refund Status?

It is very easy to check your refund status. Go to the IRS “Where’s My Refund” website, type in your Social Security number or ITIN, select the filing status, and learn your exact refund amount in seconds.

In short, check your filing history and act before all deadlines to ensure your old refunds from previous tax years. Whether it’s an unclaimed stimulus check, taking advantage of key credits, or simply overpaying your taxes, every American taxpayer filing taxes has the right to take extra money out of the US government’s hands.

For more information on the IRS’s collection processes, visit the IRS – Fact Sheet: The Collection Process.

Here are some other helpful IRS resources:

Time IRS can collect tax
https://www.irs.gov/filing/time-irs-can-collect-tax

Who should file for IRS tax returns
https://www.irs.gov/individuals/check-if-you-need-to-file-a-tax-return

Steps to file your taxes
https://www.irs.gov/how-to-file-your-taxes-step-by-step

Getting an extension to file tax return
https://www.irs.gov/filing/get-an-extension-to-file-your-tax-return

How to file an amended return
https://www.irs.gov/filing/file-an-amended-returnht

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