The IRS is preparing to distribute stimulus payments totaling millions of dollars to about one million taxpayers. These payments, which could be as much as $1,400, are intended to address errors made on 2021 tax returns regarding the Recovery Rebate Credit.
Why Are These Stimulus Payments Being Issued?
The Recovery Rebate Credit was established to help individuals who didn’t receive one of the three COVID-19 stimulus payments or didn’t get the full amount they were eligible for. However, according to the IRS, many taxpayers failed to claim the credit on their 2021 tax returns, often leaving the relevant field blank or entering “0” when they were actually entitled to a payment.
To resolve this, the IRS has reviewed taxpayers’ data and is automatically processing the corrections—no action is required from taxpayers.
What Is the Recovery Rebate Credit?
The Recovery Rebate Credit enables eligible taxpayers to claim missed stimulus payments. Rather than asking individuals to file an amended return, the IRS commissioner, Danny Werfel, announced that the agency would handle the adjustments internally to simplify the process.
“Our aim is to make things easier for taxpayers,” Werfel said. “These payments reflect our commitment to going the extra mile to support taxpayers.”
Payment Details: When and How Will You Receive It?
If you’re eligible for this payment, the funds will be sent in one of two ways:
- Direct Deposit: The money will be deposited into the bank account you used for your 2023 tax return.
- Mailed Check: If direct deposit isn’t available, a check will be mailed to the address on file.
The best part? No additional steps are required on your part. The IRS anticipates that most payments will reach taxpayers by the end of January.
What Should You Do Next?
Eligible taxpayers don’t need to take any action but should monitor their bank accounts or mailboxes for the payment in the coming weeks. This unexpected financial boost could provide some much-needed assistance.
Key Details at a Glance
| Feature | Details |
|---|---|
| Payment Amount | Up to $1,400 |
| Reason | Correction of Recovery Rebate Credit errors |
| Eligibility | Taxpayers who missed stimulus payments or credits |
| Payment Method | Direct deposit or mailed check |
| Estimated Payment Date | By the end of January |
| IRS Action Required | Automatic correction by IRS |
FAQs
1. What is the Recovery Rebate Credit?
The Recovery Rebate Credit helps individuals who missed a COVID-19 stimulus payment or didn’t receive the full amount to claim what they’re owed.
2. Do I need to file an amended return to get this payment?
No, the IRS is automatically reviewing and correcting eligible returns to issue payments.
3. How will I know if I’m eligible?
If you’re eligible, the IRS will send your payment directly to your bank account or mailing address. No additional notification is required.
4. When can I expect the payment?
The IRS estimates most payments will be distributed by the end of January.
5. How will the payment be sent?
Payments will be delivered via direct deposit to the bank account on file or as a mailed check to your registered address.
