Due to the ongoing challenges posed by inflation and the rising cost of living, many Americans are struggling financially. In response, the IRS is offering special payments of up to $1,400 for eligible taxpayers.
This initiative is designed to provide much-needed relief to approximately one million taxpayers who will benefit from these refundable credits.
Automatic Payments for Recovery Rebate Credit
The Internal Revenue Service (IRS) has begun automatically issuing payments to eligible taxpayers who missed claiming the Recovery Rebate Credit on their 2021 tax returns.
This credit is directly linked to the COVID-19 stimulus payments, which were part of the government’s efforts to provide financial support during the pandemic.
No Action Required for Eligible Taxpayers
The IRS has made it clear that taxpayers who qualify for the recovery rebate credit do not need to take any action. These individuals have already been identified in the system, and their payments will be issued automatically.
Many eligible taxpayers have already received their payments via direct deposit into the bank account they provided on their 2023 tax returns.
While there is no specific date announced for the completion of payments, the IRS expects the distribution to be finalized by January 2025. For those not receiving direct deposits, checks will be sent by mail to the addresses the IRS has on file.
Background on Economic Impact Payments (EIP)
The Economic Impact Payments (EIP), distributed in three rounds by the IRS and the U.S. Department of the Treasury, were designed to provide relief during the pandemic. However, it became apparent that many eligible taxpayers had filed their tax returns without claiming the Recovery Rebate Credit.
In December, IRS Commissioner Danny Werfel explained that to make the process simpler and more accessible for taxpayers, the IRS decided to issue these payments automatically. This means taxpayers will not need to amend their returns to receive the credit, thus reducing the burden of paperwork.
Last Chance to Claim the $1,400 Refund
The IRS has already completed distribution of special payments to individuals who filed their 2021 tax return but missed claiming the Recovery Rebate Credit or made an error in reporting it as $0, even though they were eligible for it.
However, there is still an opportunity for those who did not file a 2021 tax return to claim the credit. Taxpayers who missed filing in 2021 but are eligible for the Recovery Rebate Credit can still file a tax return to receive the payment.
According to the IRS, even if a taxpayer’s income was minimal or non-existent in 2021, they are still eligible to claim the credit if they file a return. The April 15, 2025 deadline for filing a return is the final chance to secure the $1,400 refund.
Important Dates for the Recovery Rebate Credit
| Event | Date or Deadline |
|---|---|
| Deadline to file a return for Recovery Rebate Credit | April 15, 2025 |
| Expected completion of special payments | January 2025 |
| Distribution method for eligible taxpayers | Direct deposit or mailed check |
With the IRS offering up to $1,400 in special payments to eligible taxpayers, many Americans who have faced financial difficulties due to inflation and the rising cost of living will benefit from these refunds.
If you missed claiming the Recovery Rebate Credit on your 2021 tax return, there is still time to file and receive this valuable payment.
However, eligible taxpayers who haven’t received their refund yet should check their payment status and ensure they’ve provided the necessary information to receive the payment.
FAQs
Who qualifies for the $1,400 special payment?
Taxpayers who were eligible for the Recovery Rebate Credit but missed claiming it on their 2021 tax returns may receive this special payment.
Do I need to take action to receive the payment?
No, if you are eligible, the IRS will issue the payment automatically. If you haven’t received it yet, check the payment status on the IRS website.
What should I do if I didn’t file a tax return in 2021?
If you didn’t file a 2021 tax return, you can still claim the Recovery Rebate Credit by filing a return before April 15, 2025.
