The Internal Revenue Service (IRS) is set to issue automatic stimulus payments to eligible Californians and other taxpayers who missed out on claiming the Recovery Rebate Credit during their 2021 tax filings.
This move, affecting around one million taxpayers, aims to provide financial relief to those who inadvertently overlooked the credit, offering a maximum payment of $1,400 per person.
These payments are expected to arrive by late January 2025.
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Background on the IRS Payments
In a press release issued on December 20, 2024, the IRS revealed that they had reviewed internal data and discovered a significant number of taxpayers who failed to claim the Recovery Rebate Credit.
This credit was part of the federal government’s COVID-19 relief efforts, providing stimulus payments to eligible taxpayers.
To ensure these individuals receive the benefits they are entitled to, the IRS will automatically issue payments without requiring these taxpayers to go through the often tedious process of filing amended returns.
According to Danny Werfel, IRS Commissioner, “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, meaning these people will not be required to go through the extensive process of filing an amended return to receive it.”
Who Will Receive the Payment?
The IRS will automatically send payments to one million taxpayers who were eligible for the Recovery Rebate Credit but did not claim it on their 2021 tax returns.
The total estimated amount for these payments will be around $2.4 billion, with individuals receiving a maximum of $1,400.
Eligible recipients will receive a direct deposit or a paper check, depending on the payment information already provided on their 2023 tax returns. In addition, taxpayers will also receive a separate letter notifying them about the upcoming payment.
Payment Amounts and Timing
The amount of the stimulus payment will vary depending on individual circumstances, such as income and family size.
However, the maximum payment is $1,400 per person, which aligns with the maximum amount for eligible individuals in the 2021 Recovery Rebate Credit.
These payments will begin to be issued by late January 2025. Taxpayers who had filed their 2021 tax returns but missed the Recovery Rebate Credit will not need to take any additional steps to claim the payment—they will simply receive it automatically.
| Taxpayer Status | Estimated Payment | Eligibility Criteria |
|---|---|---|
| Single taxpayer | Up to $1,400 | Missed the Recovery Rebate Credit on 2021 return |
| Married couple (filing jointly) | Up to $2,800 | Both spouses missed the credit in 2021 |
| Dependent (under age 17) | $1,400 per child | Dependent claimed on 2021 tax return |
What if I Didn’t File My 2021 Taxes?
If you didn’t file your 2021 taxes, you may still be eligible for the stimulus payment. In that case, you need to file your 2021 tax return and claim the Recovery Rebate Credit by April 15, 2025.
Once your return is processed, the IRS will issue the payment to you based on the eligibility requirements.
How Will I Receive My Payment?
The IRS will send your payment automatically using the bank account or address associated with your 2023 tax return.
If your payment was set up via direct deposit, it will be deposited into your account. Otherwise, you’ll receive a paper check in the mail.
Additionally, the IRS will send you a separate notice informing you of your Recovery Rebate Credit payment, including the amount you will receive.
Who is Eligible for the Special Payment?
To be eligible for this payment, you must meet the following criteria:
- Did not claim the Recovery Rebate Credit on your 2021 tax return.
- IRS data indicates you qualify for the credit.
- Taxpayers who entered $0 or left the Recovery Rebate Credit field blank on their 2021 return are eligible.
The IRS’s automatic payments to eligible Californians and others who missed the Recovery Rebate Credit is an important step in ensuring that all taxpayers receive the financial relief they are entitled to.
By offering automatic payments, the IRS eliminates the need for individuals to file amended returns, simplifying the process and helping eligible taxpayers get the money they deserve.
If you believe you are eligible, be sure to check your tax records and keep an eye on payment notices from the IRS to stay informed.
FAQs:
Do I need to apply for the payment?
No, the IRS will issue the payments automatically. You do not need to take any additional steps if you qualify.
How much money will I get?
The maximum amount is $1,400 per eligible individual or more if you have qualifying dependents.
What if I missed the deadline to file my 2021 taxes?
If you missed the filing deadline, you can still claim your payment by filing your 2021 tax return by April 15, 2025.
