Many taxpayers don’t realize that simply failing to file a tax return can mean permanently losing money that is rightfully theirs. Over the years—first during my time working at the IRS and now in private practice—I’ve seen this happen far too often. People assume that if they’re owed a refund, there’s no urgency to file. Unfortunately, that assumption can be costly.
For those who have not yet filed their 2022 tax returns, the window to claim a refund is quickly closing. The deadline is April 15, 2026—just a few weeks away. According to the IRS, more than 1.3 million individuals are currently owed refunds totaling approximately $1.2 billion, with the average refund coming in at $686. That’s not an insignificant amount, especially in today’s economic climate, and yet many taxpayers are at risk of losing it entirely.
The reason comes down to a strict rule: taxpayers generally have three years from the original filing deadline to submit a return and claim a refund. Once that three-year window closes, any unclaimed refund becomes the property of the U.S. Treasury. There are no extensions, appeals, or second chances after that point. In other words, failing to act within this timeframe is effectively the same as giving that money away.
Beyond just the refund itself, failing to file can also mean missing out on valuable tax credits. One of the most significant is the Earned Income Tax Credit (EITC), which is designed to benefit low- to moderate-income workers. For eligible individuals and families, the EITC can substantially increase the total refund amount—sometimes by thousands of dollars. If a return is never filed, those credits are lost along with the refund, compounding the financial impact.
It’s also important to understand that even when a refund is claimed, it may not always result in a payment being issued. Refunds can be reduced or entirely offset to cover outstanding obligations such as unpaid federal or state taxes, past-due child support, or defaulted student loans. Additionally, the IRS may hold a refund if the taxpayer has not filed returns for other required years. This underscores a broader point: staying current with filing requirements is essential, not just for compliance, but to ensure access to any funds owed.
At its core, failing to file a delinquent return when a refund is due is more than just a missed administrative task—it’s a missed financial opportunity. With the deadline approaching, now is the time for taxpayers to review their filing history and take action before that money is lost for good.