IRS distributes $1.4 Billion in special payments to 1 million Americans: Who qualifies?

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In a significant move to provide additional financial support, the Internal Revenue Service (IRS) has announced the distribution of $1.4 billion in automatic payments, benefiting approximately one million taxpayers.

This latest round of payments, set to reach recipients by late January 2025, follows the IRS’s efforts to ensure that individuals who missed out on previous economic relief benefits during the pandemic are now receiving the funds they are entitled to.

The payments, which are up to $1,400 per individual, are part of the Recovery Rebate Credit program. This credit was designed for taxpayers who did not receive one or more Economic Impact Payments (stimulus checks) for the 2021 tax year.

The latest batch of payments will be issued to those who failed to claim the credit when filing their 2021 tax returns, with the IRS now working to rectify the oversight and ensure that eligible taxpayers receive the funds.

Who Qualifies for the Payments?

Eligibility for the $1,400 payments is determined based on the Recovery Rebate Credit, which was initially introduced as part of the government’s pandemic relief efforts.

Individuals who did not receive their full stimulus payments in 2021 and are eligible for the credit will automatically receive the payment without needing to take any further action.

To qualify, taxpayers must meet the following criteria:

1. Non-Filers in 2021: Individuals who did not file a tax return in 2021 but were eligible for stimulus payments.
2. Adjusted Gross Income: The payments are aimed at those with an Adjusted Gross Income (AGI) under the thresholds established for the stimulus program (generally $75,000 for individuals and $150,000 for married couples filing jointly).
3. Not Claimed the Credit: Those who missed claiming the credit when filing their 2021 tax returns.

The IRS has emphasized that these payments will be issued through direct deposit for those who provided bank details in their recent tax filings.

Those without direct deposit information on file will receive paper checks sent to the address listed on their tax return.

What Should Taxpayers Do?

Taxpayers who believe they are eligible but have not yet filed a 2021 return can still claim the Recovery Rebate Credit by filing their 2021 tax return before the deadline of April 15, 2025. This ensures they will not miss out on the credit and can still receive their payment as part of future batches.

This move by the IRS is part of ongoing efforts to ensure equitable distribution of relief funds, especially to those who may have been overlooked or faced barriers in receiving earlier stimulus payments.

The agency encourages all eligible individuals to check their payment status using the IRS online tool and file any outstanding tax returns to secure their funds.

For more details on this initiative and to check your eligibility, taxpayers are urged to visit the IRS official website or consult with a tax professional.

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