IRS Surprises 1 Million Americans – The IRS announces automatic payments of up to $1,400 for eligible taxpayers who didn’t claim the 2021 Recovery Rebate Credit. Learn who qualifies and when to expect payments.
The Internal Revenue Service (IRS) is set to distribute approximately $2.4 billion in automatic payments to nearly 1 million Americans who were eligible for but did not claim the Recovery Rebate Credit on their 2021 tax returns. This unexpected windfall, announced on December 26th, 2024, comes as a result of the agency’s internal data analysis and commitment to ensuring eligible taxpayers receive their due benefits.
Who Qualifies for the Payment?
The automatic payments target approximately 1 million taxpayers who filed their 2021 tax returns but either left the Recovery Rebate Credit field blank or entered $0, despite being eligible for the credit. These individuals do not need to take any action to receive the payment.
IRS Commissioner Danny Werfel stated, “Looking at our internal data, we realized that one million taxpayers overlooked claiming this complex credit when they were actually eligible. To minimize headaches and get this money to eligible taxpayers, we’re making these payments automatic.”
Payment Details and Timeline
The payment amounts will vary based on individual circumstances, with a maximum of $1,400 per person. The IRS plans to issue these payments before the end of December 2024, with some potentially arriving by late January 2025.
Eligible taxpayers will receive their payments via direct deposit to the bank account listed on their 2023 tax return. If the bank account is closed or not available, the IRS will mail a paper check to the address on file.
Impact and Importance
This initiative by the IRS demonstrates the agency’s commitment to ensuring taxpayers receive the benefits they’re entitled to, even when they may have overlooked claiming them. It also highlights the importance of carefully reviewing tax returns and understanding available credits.
The IRS continues to work hard to make improvements and help taxpayers, Werfel added. These payments are an example of our commitment to go the extra mile for taxpayers.
For those who haven’t filed their 2021 tax returns, this announcement serves as a reminder of the approaching April 15, 2025 deadline to claim any outstanding credits, including the Recovery Rebate Credit.
As these payments roll out, eligible recipients should keep an eye on their bank accounts or mailboxes in the coming weeks. The additional funds could provide a welcome boost to many Americans as they start the new year.
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