The US Internal Revenue Service is paying out approximately $2.4 billion to taxpayers who were unable to collect their COVID-19 pandemic stimulus payments. By the end of January, approximately a million people will have received special payments totaling up to $1,400.
According to the IRS, these reimbursements will go to taxpayers who did not claim a refund recovery credit on their 2021 tax returns. People who have not received one or more Economic Impact Payments (EIPs), also known as stimulus payments, are eligible for this refundable credit.
The Internal Revenue Service (IRS) sends automatic stimulus payments to U.S. citizens
IRS Commissioner Danny Werfel stated, “After studying their internal data, they revealed that one million taxpayers were qualified for this difficult credit but did not claim it.” Ginny Bultman, 61, of Colorado, was one of the taxpayers who profited.
Bultman and her spouse received no stimulus payments in 2021. She discovered she was eligible for the refund recovery credit after researching the most recent IRS payments. One day later, her pay arrived in the mail.
Bultman, the owner of a nearby locksmith company, commented, “It was a pleasant surprise.” The Bultmans received $4,200 in late December from three late stimulus payments, one of which was for their young child. You should be aware of the following about IRS payments:
- Who is qualified to get a check? Those taxpayers who submitted a 2021 tax return but either entered in the Refund Recovery Credit data box as $0 or left it blank, even though they qualified for it, will get the special payouts that the IRS announced.
- What is the amount that qualified taxpayers will get? Although payments will differ, each person may receive up to $1,400. Approximately $2.4 billion will be disbursed by the IRS to taxpayers who failed to claim a refund recovery credit on their 2021 tax returns. The IRS has posted information online about eligibility and how the payment is calculated.
- Why are stimulus payments being sent out by the IRS? For those who did not get economic impact payments in 2020 and 2021, there is a refundable credit known as the Refund Recovery Credit. After analyzing its data and discovering that many qualified taxpayers who filed a 2021 tax return failed to claim the credit, the IRS initiated this program.
It is critical to emphasize that we are automating these stimulus payments in order to reduce inconvenience and ensure that eligible taxpayers receive the funds. This means that they will not have to go through the time-consuming process of filing an updated return in order to obtain it, according to Werfel.
If you qualify for a stimulus payment, how will you receive it?
If you are eligible for the refund recovery credit, you do not need to take any action. Eligible taxpayers will receive IRS letters informing them of the special payment. Stimulus payments will be sent automatically this month and should arrive via direct deposit or check by the end of January. They will be sent to the taxpayer’s bank account listed on their 2023 tax return or to the address on file with the IRS.
What happens if I haven’t yet submitted my tax return for 2021?
The money could still be given to you. The IRS states that even if a taxpayer’s income from a job, business, or other source is minimal or nonexistent, they must file a tax return and claim the refund recovery credit by April 15, 2025.
What was the number of rounds of COVID-19 stimulus payments?
A total of $814 billion was distributed to households affected by the epidemic in three waves. The IRS created them based on the taxpayer’s income, tax filing status, and the number of qualifying dependents or children.
In March 2020, the Coronavirus Assistance, Relief, and Economic Security (CARES) Act provided up to $1,200 per income tax filer and $500 per child to eligible individuals.
The Consolidated Appropriations Act provided qualified individuals with up to $600 per tax filer and $600 per child in December 2020. In March 2021, the American Recovery Plan Act provided up to $1,400 per tax filer and $1,400 per child to qualifying individuals.
