Over the past few weeks. the IRS sent out letters to approximately nine million taxpayers who appear to qualify for additional stimulus money (in the form of tax credits), but didn’t yet claim them by filing a 2021 federal income tax return. Thursday, Nov. 17 is the last day that eligible households can file a 2021 tax return at IRS.gov/freefile to claim these tax credits, which include:
Child Tax Credit
The enhanced Child Tax Credit increased the dollar amount to as much as $3,600 per child in 2021, up from the standard $2,000 per child. Qualifying parents received monthly checks from the IRS for the last six months of 2021, which constituted half of the annual credit. Families can now claim the second half.
2021 Recovery Rebate Credit
This is the third round of stimulus checks signed off on by lawmakers during the pandemic. It provides up to $1,400 per qualifying person, including eligible children claimed on one’s tax return. This credit is available to single taxpayers making less than $75,000 and to married couples bringing in less than $150,000.
Earned Income Tax Credit
Taxpayers can claim the EITC if they pull in under $21,430 (single taxpayers) or $27,380 (married couples filing jointly). Childless taxpayers between the ages of 25 and 64 can get up to $1,502. Working families with three children can get as much as $6,728.
Child and Dependent Care Credit
Families who pay for daycare so they can work or seek employment can nab a tax credit worth up to $4,000 for one qualifying person and $8,000 for two or more qualifying persons.
Deduction for Gifts to Charity
Most taxpayers who elect the standard deduction can deduct eligible cash contributions they made in 2021. Individuals can deduct up to $300, and married couples filing jointly can deduct up to $600 in cash donations. Itemizers who make large cash donations are often eligible to deduct the full amount in 2021.
To file their return to claim these tax credits, taxpayers can go to IRS.gov/freefile. Free File allows those whose incomes are $73,000 or less to file a return online at no cost. The site will remain open until midnight E.T. on Thursday, Nov. 17. Filers can also visit ChildTaxCredit.gov to file a 2021 income tax return, even if they don’t have children.
Free file is usually only available until October, but the IRS extended availability through Nov. 17 to give people more time to get their 2021 returns in. You have to file a 2021 return to get your unclaimed tax credit/rebate, but you don’t have to file it by today — taxpayers can still prepare and print paper returns to mail using H&R Block, TurboTax or a similar service. That said, it is best to file electronically and to opt for direct deposit.
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