Claim Your 2018 Tax Refund Now – Or Lose It Forever

The IRS is looking for about 1.5 million people who didn’t file a 2018 tax return and who might be owed a refund of taxes that were withheld or otherwise prepaid. In fact, Uncle Sam has almost $1.5 billion of potential refunds waiting to be claimed. The median potential refund is estimated to be $813. Is any of that money yours?

Claim Your Refund By April 18

Act now if you think some of that cash could belong to you. In cases where a federal tax return was not filed, the taxpayer generally has a three-year window of opportunity to claim a refund. That means you must file your 2018 tax return with the IRS no later than this year’s tax filing deadline to collect the money. For most people, that’s April 18 (April 19 for residents of Main or Massachusetts). If you don’t file a 2018 return in time, the U.S. Treasury gets the money and you’re out of luck.

Missing W-2 and Other 2018 Tax Forms?

If you’re missing W-2, 1098, 1099 or 5498 forms from 2018, try getting copies from your employer, bank or other payer. If that doesn’t work, you can go on the IRS website and order a free wage and income transcript or request one by filing Form 4506-T. The transcript will show data from information returns received by the IRS. This information can be used to file your 2018 tax return.

What If You Have a Tax Debt or Didn’t File Other Returns?

The IRS could hold your 2018 refund check if you didn’t file a 2019 or 2020 return, either. In addition, the IRS may also apply your 2018 refund to any federal or state taxes you owe for other years — or to offset unpaid child support or past due federal debts, such as student loans.

Eligibility for 2018 Earned Income Tax Credit

By filing a 2018 tax return, many low- and moderate-income workers may also be eligible for the earned income tax credit for that year. The credit was worth as much as $6,431 for 2018. The credit helps individuals and families whose incomes are below certain thresholds. The thresholds for 2018 were:

  • $49,194 ($54,884 if married filing jointly) for people with three or more qualifying children;
  • $45,802 ($51,492 if married filing jointly) for people with two qualifying children;
  • $40,320 ($46,010 if married filing jointly) for people with one qualifying child; and
  • $15,270 ($20,950 if married filing jointly) for people without qualifying children.


Why Your Tax Refund Could Be Bigger This Year

At a time when many Americans are paying more for everything from gas to ground beef, tax refunds will provide much-needed cash for many families. And this year, those refunds could be particularly generous.

Through the March 4, the average federal tax refund was $3,401, up 13.7% from the same period last year, according to the IRS. In 2021, the average refund was $2,815.

People who expect a big refund tend to file early, so the average for the 2022 tax season may be lower. Still, there are several reasons many taxpayers could get a larger refund this year. Taxpayers who were eligible for a third Economic Impact Payment and didn’t receive a check, or received less than the full amount, will have the opportunity to claim the recovery rebate credit when they file their 2021 tax return. The credit is worth up to $1,400. Likewise, taxpayers who were eligible for the expanded child tax credit, worth up to $3,600 in 2021, will have an opportunity to claim it when they file their 2021 tax return.

The IRS sent out advance child tax credits in six monthly payments last year, but not everyone who was eligible for the payments received them. If you had a newborn last year, for example, you didn’t receive the advance credits because the IRS didn’t have a record of the addition to your family. But when you file your 2021 tax return, you’ll be able to claim the credit.

Young adults may also receive a larger-than-expected refund this year because of a provision in the American Rescue Plan that expanded the earned income tax credit, which is designed to help low- and moderate-income workers. The legislation expanded eligibility for the credit to include workers between age 19 and 24 who don’t have children.

Investing Your Tax Refund

Nearly 60% of taxpayers expect to receive a refund this year. If you’re interested in investing all or part of your money, many brokerage firms will allow you to open an account for less than $500, and some have no minimum requirements. Coinbase, an online platform for cryptocurrency investors, says taxpayers who file their returns using TurboTax can have their refunds converted into Bitcoin, Ethereum or one of the other cryptocurrencies the company supports.

Cryptocurrencies are extremely volatile. Risk-averse investors may want to invest their refunds in Series I bonds. I bonds issued from November 2021 through April 2022 yield a composite rate of 7.12%. You can buy up to $10,000 each year in electronic I bonds and apply your tax refund to purchase up to $5,000 in paper bonds.

Finally, although it’s nice to get a check from the IRS, there are more-effective ways to use your money than giving the government an interest-free loan. The IRS offers a tool on its website that you can use to adjust your withholding.


How to Get Your Tax Refund Faster

If you’re expecting a federal tax refund this year, you could get your money back in as little as three weeks. Historically, the IRS has issued over 90% of refunds due in less than 21 days. But this year could be different. Because of COVID-related disruptions, the IRS entered this tax filing season with millions of unprocessed tax returns from previous years. That’s going to slow them down and potentially delay your refund. Fortunately, there are a few things you can do to speed up the process and increase the odds of getting your tax refund quickly.

The first trick is to file your return as early as you can. The sooner you file your tax return, the sooner you’ll get any tax refund due. That’s because your return will be closer to the front of the line, rather than towards the back.

If you want to speed up the refund process even further, e-file your tax return. Paper returns slow things down considerably. There are a number of ways to file electronically. Of course, you can find a professional tax preparer to file an electronic return for you (most expensive route). Seniors, people earning $58,000 or less, disabled people, and taxpayers with limited English-language skills may also qualify for free tax assistance and e-filing through the IRS’s Tax Counseling for the Elderly and Volunteer Income Tax Assistance programs. There are also several e-filing options for the “do it yourself” crowd, such as using a commercial tax software product (e.g., TurboTax) or forms/software on the IRS website. If your 2021 adjusted gross income is $73,000 or less, you can even file your federal return for free!

Finally, make sure you select the direct deposit payment method for your refund. Just like paper returns, paper checks take much longer to process. It’s also the fastest and most convenient payment option (no trip to the bank needed). Plus, there’s always the chance that a paper check could get stolen or lost in the mail.

Tax Refund Delays Can Still Happen

Even if you file early, file electronically, and request direct deposit, it still takes more time for the IRS to process some tax returns. If that happens, your refund could be delayed. Process delays should be expected if your return:

  • Includes errors;
  • Is incomplete;
  • Is affected by identity theft or fraud;
  • Includes Form 8379, Injured Spouse Allocation (which could take up to 14 weeks to process); or
  • Needs further review in general.

The IRS will contact you by mail if they need more information to process your return.

Also, by law, refunds for returns claiming the earned income tax credit or the additional child tax credit must be delayed. They can’t be issued before mid-February. This applies to the entire refund, not just the portion associated with the credits. However, for 2022, the IRS said these refunds should start being paid by March 1 if direct deposit is chosen and there are no other issues with the tax return (some people may have received refunds a few days earlier).

If you’re a non-resident alien filing Form 1040-NR who is requesting a refund of tax withheld from U.S. source income, you should allow up to 6 months from the original due date of the 1040-NR return or the date you filed the form, whichever is later, to receive any refund due.

Tracking Your Tax Refund

The IRS has a handy online tool that lets you track the status of your tax refund. It’s called the “Where’s My Refund” portal, and it will tell you if the IRS is processing your return, getting ready to send your refund, or has already sent you your money. The tool is updated daily.

The portal is located on the IRS website. You’ll need your Social Security number (or individual taxpayer identification number), the filing status used on your 2021 tax return, and the exact amount of your expected refund to access it.