If you haven’t yet filed your 2021 tax return, you could be missing out on a significant payment. The IRS is distributing billions of dollars to eligible taxpayers who didn’t claim a key credit.
According to AP News, many individuals may be unaware that they qualify for this credit, which could be a refund even for those with little or no income.
This initiative is part of an effort to ensure that all eligible taxpayers receive their rightful stimulus payments from the past two years. The deadline to act is approaching, so it’s crucial not to miss out.
Who Is Eligible for the Recovery Rebate Credit?
Taxpayers who filed a 2021 tax return but left the Recovery Rebate Credit field blank or incorrectly filled it out may be eligible for the credit. These taxpayers are now being identified by the IRS and will automatically receive the payments, even if they didn’t actively claim the credit.
The payment amount varies, but eligible individuals can receive up to $1,400. The IRS is issuing payments totaling $2.4 billion, and these will be automatically sent to taxpayers who missed claiming the credit.
IRS Actions to Rectify Missed Claims
The IRS announced that it is making these payments automatic to avoid the need for taxpayers to file amended returns. IRS Commissioner Danny Werfel emphasized,
Looking at our internal data, we realized that one million taxpayers overlooked claiming this complex credit when they were actually eligible – Werfel further added,
To minimize headaches and get this money to eligible taxpayers, we’re making these payments automatic, meaning these people will not be required to go through the extensive process of filing an amended return to receive it.
Even if you haven’t filed your 2021 tax return, it’s not too late. The IRS has set a deadline of April 15, 2025, for taxpayers to file and claim the Recovery Rebate Credit. This includes individuals who may have had little to no income during 2021 but still qualify for the credit.
A Closer Look At the Stimulus Payment Rounds
There were three rounds of COVID stimulus payments, totaling $814 billion, to help households during the pandemic. In 2020 and 2021, the IRS distributed payments based on income, filing status, and number of dependents. Those who missed these payments are now being assisted through the Recovery Rebate Credit process.
Taxpayers eligible for the Recovery Rebate Credit do not need to take further action beyond filing their 2021 return. Payments will be sent automatically, either by direct deposit or check, to the bank account or address the IRS has on file.
