1.5 Million People To Receive Bonus Check From IRS — Are You Eligible?
The IRS announced Wednesday that another 1.5 million taxpayers will receive refunds averaging around $1,500, as unemployment adjustment compensations continue to be sent out from previously filed tax returns.
The American Rescue Plan, which was signed into law in March, made up to $10,200 of unemployment benefits exempt from federal tax. This applied to individuals and married couples whose modified adjusted gross income was less than $150,000.
However, some taxpayers happened to have filed their taxes before the date the new bill went into effect. The IRS automatically made this adjustment, and refunds by direct deposit began July 28. Refunds by paper check will begin today. This is the fourth round of refunds related to the unemployment exclusion provision, the IRS states.
For this particular round of payments, the IRS identified nearly 1.7 million taxpayers that were entitled to an adjustment, with 1.5 million owed a refund averaging $1,686. Importantly, the IRS states that the average refund amount is higher for this round, as the Advance Premium Tax Credit was included.
Since May, over 8.7 million unemployment refunds have been sent out totaling over $10 billion, and will continue to review and do so throughout the summer. The IRS is automatically adjusting returns means most taxpayers who were affected by this switch will not have to file an amended return themselves.
If you believe you are owed this compensation, but have not received any notice from the IRS yet, you may need to file an amended return. The IRS typically sends a notice of adjustment within 30 days. Those who are now eligible or have credits not claimed in their original return should file a Form 1040-X, Amended U.S. Individual Income Tax Return. You should only file this form if you did not submit a Schedule 8812 with the original return to claim the additional child tax credit and are now eligible for the credit after the new unemployment exclusion. You should also file an amended return if you did not submit a Schedule EIC with the original return or claim the earned income tax credit and are now eligible after the exclusion. You should also file an amended return if you are now eligible for any other credit or deductions.
More From GOBankingRates
- What Money Topics Do You Want Covered: Ask the Financially Savvy Female
- 5 Things Most Americans Don’t Know About Social Security
- 20 Home Renovations That Will Hurt Your Home’s Value
- What Income Level Is Considered Middle Class in Your State?
Last updated: July 30, 2021