Up to $1,400 will soon be distributed to a million taxpayers by the IRS. Who are these individuals and what is the reason for their emergence at this moment?
In the upcoming weeks, around 1 million taxpayers are set to receive automatic special payments from the IRS, with amounts reaching as high as $1,400.
Eligible individuals will receive the funds either through direct deposit into their bank accounts or via a paper check sent by mail.
The IRS announced it will be sending approximately $2.4 billion to taxpayers who did not claim a Recovery Rebate Credit on their 2021 tax returns.
Individuals who did not receive a complete COVID stimulus payment or missed one entirely had the opportunity to claim the credit. However, the IRS announced on Friday that it found a significant number of eligible taxpayers had not completed the necessary steps.
“Looking at our internal data, we realized that one million taxpayers overlooked claiming this complex credit when they were actually eligible,” IRS Commissioner Danny Werfel said in a statement.
What are the chances I’ll get a check?
Apologies, but it’s likely quite minimal. The IRS announced that the majority of taxpayers qualified for the federal stimulus payments have already received their funds.
The IRS has announced that special payments are being distributed to taxpayers who submitted a 2021 tax return but either left the Recovery Rebate Credit field empty or indicated $0, despite being eligible for the credit.
What is the process behind this?
Taxpayers who qualify are not required to do anything. This month, payments will be processed automatically and are expected to reach recipients via direct deposit or check by the end of January 2025.
Funds will be directed to the bank account specified on the taxpayer’s 2023 return or to the address that the IRS has recorded.
The maximum payment amount will be $1,400 for each individual, though actual payments may differ. Details regarding eligibility and the calculation of the payment have been made available by the IRS on their website.
The IRS is set to issue individual letters to qualifying taxpayers to inform them about the special payment.
What should I do if my 2021 tax return is still unfiled?
There’s still a chance for you to get the funds. Taxpayers must ensure they file a tax return and claim the Recovery Rebate Credit by the deadline of April 15, 2025, regardless of whether their income from employment, business, or other sources was low or absent, as stated by the IRS.
Total number of rounds for COVID relief payments
Households affected by the pandemic received three rounds of payments, amounting to a total of $814 billion. The amounts received by taxpayers were determined by the IRS based on their income, tax filing status, and the number of children or qualifying dependents.
In March 2020, qualifying individuals were provided with a payment of up to $1,200 for each income tax filer and an additional $500 for each child under the provisions of the CARES Act.
In December 2020, qualifying individuals were granted up to $600 for each income tax filer and an additional $600 for every child under the Consolidated Appropriations Act. In March 2021, qualifying individuals were granted as much as $1,400 for each income tax filer and $1,400 for every child under the American Rescue Plan Act.
