(Washington, D.C.) The Internal Revenue Service has announced plans to issue automatic payments later this month to eligible people who did not claim the Recovery Rebate Credit on their 2021 tax returns.
The IRS announced the special step after reviewing internal data showing many eligible taxpayers who filed a return but did not claim the credit. The Recovery Rebate Credit is a refundable credit for individuals who did not receive one or more Economic Impact Payments (EIP), also known as stimulus payments.
No action is needed for eligible taxpayers to receive these payments, which will go out automatically in December and should arrive in most cases by late January 2025, according to the IRS. The payments will be automatically direct deposited or sent by paper check; eligible taxpayers will also receive a separate letter notifying them of the payment.
“The IRS continues to work hard to make improvements and help taxpayers,” said IRS Commissioner Danny Werfel. “These payments are an example of our commitment to go the extra mile for taxpayers. Looking at our internal data, we realized that one million taxpayers overlooked claiming this complex credit when they were actually eligible. To minimize headaches and get this money to eligible taxpayers, we’re making these payments automatic, meaning these people will not be required to go through the extensive process of filing an amended return to receive it.”
The payments vary depending on several factors, but the maximum payment is $1,400 per individual. The estimated amount of payments going out will be about $2.4 billion.
The IRS also reminded taxpayers who haven’t filed 2021 tax returns they might be eligible as well, but they face an April 15, 2025, deadline to file their returns to claim the credit and any other refund they might be owed.
Most taxpayers eligible for EIPs have already received their EIP or Recovery Rebate Credit.
An IRS letter will be sent to the taxpayer receiving these 2021 Recovery Rebate Credit payments. If the taxpayer closed their bank account since filing their 2023 tax return, taxpayers do not need to take any action. The bank will return the payment to the IRS and the refund will be reissued to the address of record.