The IRS has announced it will automatically send stimulus payments to nearly one million taxpayers who missed out on claiming the Recovery Rebate Credit on their 2021 tax returns. This initiative, involving over $2.4 billion, aims to ensure that those eligible for past Economic Impact Payments receive the funds they deserve.
Who’s Eligible?
If you filed a 2021 tax return but did not claim the Recovery Rebate Credit, you could be among those receiving this payment. Many individuals were entitled to up to $1,400 per person but either left the credit section blank or incorrectly entered $0.
How Will Payments Be Made?
- Payments will be directly deposited into the bank accounts listed on 2021 tax returns or sent as paper checks to the address on file.
- Most payments are expected to be completed by late January 2025.
- The IRS will notify recipients with a separate letter detailing the payment.
Do You Need to Take Action?
No action is required for those eligible. The payments are being issued automatically. IRS Commissioner Danny Werfel emphasized the importance of making the process hassle-free, stating, “We want to ensure that taxpayers get the money they are entitled to without any additional effort on their part.”
What About Non-Filers?
If you didn’t file a 2021 return, it’s not too late to claim the Recovery Rebate Credit. Even if you have little or no income, you should file a tax return to ensure you receive any funds owed to you. The deadline to file and claim this credit is April 15, 2025.
Background: Economic Impact Payments
The federal government authorized three rounds of stimulus payments during the COVID-19 pandemic:
- March 2020: Up to $1,200 per individual under the CARES Act.
- December 2020: Up to $600 under the Consolidated Appropriations Act.
- March 2021: Up to $1,400 under the American Rescue Plan Act.
These payments were designed to provide financial relief to individuals and families during the economic challenges of the pandemic.
Key Takeaways:
- Eligibility: Payments are for those who missed claiming the Recovery Rebate Credit in 2021.
- No Action Required: Payments are automatic for eligible taxpayers.
- Deadline for Non-Filers: April 15, 2025.
This effort reflects the IRS’s commitment to ensuring all eligible Americans receive the financial support they were promised. Keep an eye on your mailbox or bank account for this important payment.