The Internal Revenue Service (IRS) is set to distribute $1,400 stimulus checks to one million eligible taxpayers, catching many Americans by surprise.
At a Glance
- IRS to distribute $2.4 billion in stimulus checks to one million taxpayers
- Payments of up to $1,400 per person will be sent automatically
- Eligible taxpayers will receive payments by late January
- Taxpayers who haven’t filed for 2021 can still claim the credit by April 15, 2025
Automatic Distribution of Unclaimed Credits
The Internal Revenue Service has announced a significant financial initiative aimed at rectifying oversights in the distribution of COVID-19 relief funds. In a move that will impact approximately one million taxpayers, the IRS is preparing to automatically distribute $1,400 stimulus checks to those who were eligible but did not claim the 2021 Recovery Rebate Credit on their tax returns.
This unexpected windfall comes as a result of the IRS’s internal review process, which identified a substantial number of Americans who qualified for the credit but failed to claim it. The total distribution amounts to a staggering $2.4 billion, showcasing the government’s commitment to ensuring that eligible citizens receive their entitled financial support, even if belatedly.
Can you believe they’re still handing these things out?
Eligibility and Payment Details
The eligibility criteria for these payments are based on the 2021 tax year. Single taxpayers with incomes under $80,000, married couples filing jointly with combined incomes under $160,000, and heads of household with incomes under $112,500 may qualify for the payment. It’s important to note that dependents claimed in 2021 are not eligible for this particular distribution.
“Looking at our internal data, we realized that one million taxpayers overlooked claiming this complex credit when they were actually eligible,” IRS Commissioner Danney Werfel said.
Eligible taxpayers can expect to receive their payments by late January, either through direct deposit or paper check, depending on the information provided on their 2023 tax return. The IRS has emphasized that no action is required from taxpayers to receive these payments, as they will be distributed automatically.
Simplified Process for Taxpayers
In a move to streamline the process and minimize complications for taxpayers, the IRS has decided to issue these payments automatically, without requiring recipients to file amended returns. This approach aims to expedite the distribution of funds and reduce the administrative burden on both taxpayers and the IRS.
“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,” IRS Commissioner Danney Werfel said.
The IRS will notify eligible taxpayers by letter, providing them with information about the payment and its expected arrival. This communication is crucial for taxpayers to be aware of the incoming funds and to verify their eligibility.
Impact and Future Considerations
This distribution is part of the broader COVID-19 relief efforts, which saw the federal government issue three rounds of stimulus payments totaling $814 billion. The Recovery Rebate Credit was designed for individuals who did not receive their full Economic Impact Payments during the height of the pandemic.
For those who have not yet filed a 2021 tax return, there is still an opportunity to claim the credit. The IRS has set a deadline of April 15, 2025, for taxpayers to file and potentially receive this credit. This extended timeline provides a significant window for individuals who may have missed out on previous opportunities to claim their entitled relief funds.