The IRS is taking steps to distribute stimulus checks to eligible taxpayers who failed to claim the Recovery Rebate Credit on their 2021 tax returns. These payments are expected to reach taxpayers automatically by the end of January, allowing those who are eligible to receive financial support without having to go through the cumbersome process of filing an amended return.
Recently, the IRS conducted a review of its data and discovered that approximately one million taxpayers overlooked this complex credit despite being eligible. The Recovery Rebate Credit provides a refundable credit for individuals who did not receive one or more Economic Impact Payments, which are commonly known as stimulus payments.
IRS Commissioner Danny Werfel stated, “To minimize headaches and get this money to eligible taxpayers, we’re making these payments automatic.” Eligible individuals will receive their payments either through direct deposit or via a paper check, which the IRS aims to dispatch promptly.
In terms of eligibility, taxpayers will receive a separate notification letter from the IRS detailing the incoming stimulus payment. For individuals looking to confirm their eligibility, they can review their 2021 tax returns to check if they left the Recovery Rebate Credit field blank or indicated it as $0. The maximum payment that a qualifying taxpayer could receive is $1,400, with an estimated total of $2.4 billion being distributed nationwide.
Taxpayers who did not file a tax return for 2021 may still claim their stimulus check if they file their return by April 15, 2025, and include the Recovery Rebate Credit, even if their income was minimal or non-existent. This ensures that many more eligible individuals can benefit from this government assistance designed to alleviate financial hardships.
This initiative reflects a broader effort by the IRS to ensure that financial aid reaches those in need without further complications during a challenging economic time.