The Internal Revenue Service (IRS) is set to distribute approximately $2.4 billion to around one million taxpayers who did not claim a Recovery Rebate Credit on their 2021 tax returns. Eligible individuals can expect to receive payments up to $1,400, which will either be directly deposited into bank accounts or sent as paper checks in the coming weeks.
This disbursement addresses those who missed out on one of the COVID-19 stimulus payments or received less than the intended amount but did not claim the rebate on their tax filing. According to IRS Commissioner Danny Werfel, a review of internal records revealed numerous eligible taxpayers had not claimed this credit despite qualifying for it.
To be eligible for these payments, individuals must have filed a 2021 tax return but neglected to complete or left the Recovery Rebate Credit field blank. Eligible taxpayers are not required to take additional action as the IRS will automatically distribute the payments. Deposits or checks should arrive by late January 2025, either to the bank account linked to the most recent tax return or the address on file.
For those who have yet to file their 2021 tax return, there remains an opportunity to qualify for the payment by submitting a return and claiming the Recovery Rebate Credit by the April 15, 2025, deadline.
During the pandemic, there were three phases of federal stimulus payments amounting to $814 billion. The federal government’s cumbersome technology made the distribution of the stimulus payments difficult, with thousands of Americans never receiving the payments they were due. It is unclear why the IRS is only now addressing the missing payments, nearly five years since the CARES Act was passed.
