Refunds of gift cards can be done if the gift card has been used or if it is unclaimed. To refund a gift card, go to Customers > Gift Cards and click on the gift card that you'd like to refund.
Once you click on the gift card number, you'll be taken to a screen showing you all of the sales that were paid using this gift card. Click on the very first sale of the gift card. It will be marked as the lowest numbered sale and have a negative payment amount.
After clicking on this Sale ID, you will see a Refund button on the top of the screen. This will take you into Refund mode. Click on the Refund button on the sales line for the gift card.
Next, click the Payment button and then refund the sale to the payment type you prefer. Click Finish Sale and this gift card has now been refunded.