1 Million Taxpayers to Receive IRS Special Payments: Recently, the US Internal Revenue Service (IRS) has made an important announcement. The IRS said that they will send automatic payments to eligible taxpayers who did not claim the Recovery Rebate Credit in 2021 this month. The move is like a relief for those who did not claim this credit in their tax returns earlier.
The Recovery Rebate Credit, often known as Economic Impact Payments (EIP) or stimulus payments, is a refundable credit. This means that if you are eligible and you did not receive your stimulus payments, the IRS can pay it back to you.
Automatic Payments for 2021 Recovery Rebate Credit
The IRS took this step after reviewing internal data. The data showed that many eligible taxpayers who filed returns in 2021 did not claim the Recovery Rebate Credit. Therefore, the IRS is now planning to send automatic payments to those people.
Eligible taxpayers do not need to take any additional action in this process. These payments will be automatically deposited into the bank account or sent via check. In most cases, these payments will be sent in December and taxpayers will receive them by the end of January 2025.
The IRS will also send a separate letter confirming the payment. If a taxpayer has closed his or her bank account, the payment will be sent back to the IRS by the bank and the IRS will reissue it to the taxpayer’s address.
Message from IRS Commissioner
IRS Commissioner Danny Werfel said:
“The IRS is constantly working to help taxpayers. These payments are an example of how we are going the extra mile to make sure taxpayers are comfortable. According to our data, nearly one million taxpayers forgot to claim this complex credit even though they were eligible for it. Therefore, we are automating these payments so that they don’t have to go through the complicated process of filing an amended return.”
This move will allow eligible taxpayers to get the money they deserve directly and quickly.
Payment Amount and Estimate
- The amount of the payment will depend on several factors, but the maximum payment for an individual can be up to $1,400.
- The total estimated payment is approximately $2.4 billion.
- This amount is a huge relief, especially for those who were in financial trouble and did not receive the credit yet.
The IRS also reminded that those who have not yet filed their 2021 returns may also be eligible. For this, they will have to file their return by April 15, 2025, so that they can claim the Recovery Rebate Credit and any other refund.
Most Taxpayers Already Claimed the Credit
Most eligible taxpayers have already claimed their Economic Impact Payments or Recovery Rebate Credit.
- These special payments for December 2025 are being sent only to those taxpayers whose data shows that they did not claim the credit.
- Eligible taxpayers are those who filed a 2021 return but left the Recovery Rebate Credit data field blank or filled it in as $0, even though they were actually eligible for it.
How Automatic Payments Will Work
- Taxpayers who did not claim any credit in their 2021 return will receive these payments by the end of January 2025.
- The payment will be direct deposited into the bank account provided in the 2023 tax return or a check will be sent to the taxpayer’s address.
- An IRS letter will also be sent with information about the payment.
- If the bank account is closed, the payment will come back to the IRS and then be mailed to the taxpayer’s address.
Taxpayers Who Have Not Filed a 2021 Return
The IRS reminded taxpayers who have not yet filed a 2021 return that they may be eligible.
- They must file a return by April 15, 2025, and claim the Recovery Rebate Credit.
- Even if they had little or no income, they can file a return.
- This is a chance to receive their eligible refund amount.
Additional Information and FAQs
- The IRS online account can be used to find out how much Economic Impact Payment(s) a taxpayer received.
- FAQ G2 and other related 2021 Recovery Rebate Credit topics can be used to find out this amount.
- Any Recovery Rebate Credit is not counted as income when determining eligibility for federal benefits such as Supplemental Security Income (SSI), SNAP, TANF, or WIC.
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IRS Preparations for 2025 Tax Filing Season
- The IRS will make taxpayers aware of their eligible credits and deductions in the 2025 tax filing season, including Coronavirus-related tax relief.
- Many taxpayers are unaware of the tax credits and deductions they are eligible for.
- The IRS will also remind about the Earned Income Tax Credit and other credits.
Conclusion
This move by the IRS shows that efforts to facilitate taxpayers are continuing.
- More than 1 million taxpayers will directly benefit from automatic payments of the Recovery Rebate Credit, without any additional complex process.
- If you have not been able to file a 2021 return or you did not claim the credit, this is an important opportunity for you. File your returns as soon as possible and ensure that you get the money you are entitled to.
Thus, this initiative by the IRS is not only a relief for taxpayers but also shows that the government is working towards making complex tax credits simple and accessible
