Stimulus Update: You May Be Owed Money – Here’s How to Find Out
Amid a complicated and messy tax season, the Internal Revenue Service (IRS) is telling Americans that if they didn’t get the full amount of the third Economic Impact Payment, some might be eligible to claim the 2021 Recovery Rebate Credit based on their 2021 tax year information.
In addition, Americans who didn’t get the full amounts of the first and second Economic Impact Payments may also be eligible to claim the 2020 Recovery Rebate Credit, the IRS said in an announcement.
The 2022 tax filing season started Jan. 24 and more than 160 million individual tax returns for the 2021 tax year are expected to be filed, with most before the April 18 tax deadline, according to the IRS.
“If you didn’t get the full amount of the third Economic Impact Payment, you may be eligible to claim the 2021 Recovery Rebate Credit and must file a 2021 tax return — even if you don’t usually file taxes — to claim it,” the IRS said in the announcement.
The 2021 Recovery Rebate Credit will reduce any tax owed for 2021 or be included in the tax refund.
If your income is $73,000 or less, you can file your federal tax return electronically for free through the IRS Free File Program. This represents about 70% of taxpayers, the IRS said in an earlier press release.
The IRS reiterated that the fastest way to get your tax refund is to file electronically and have it direct deposited, contactless and free, into your financial account.
“You can have your refund direct deposited into your bank account, prepaid debit card or mobile app and will need to provide routing and account numbers,” the agency said.
As for the first and second Economic Impact Payments, if you didn’t get the full amounts you may be eligible to claim the 2020 Recovery Rebate Credit and must file a 2020 tax return — even if you don’t usually file taxes — to claim it. However, the IRS says to not include any information regarding the first and second Economic Impact Payments or the 2020 Recovery Rebate Credit on your 2021 return.
Earlier this month, the IRS warned there may be delays in processing refunds due to the pandemic, several tax law changes and fewer employees. To further complicate the matter, the IRS is also still working through backlogs, CBS reported, as early in the pandemic, some of the tax processing centers were closed entirely, which stopped the processing of some returns in 2020, as GOBankingRates previously reported.
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