On December 20, 2024 the IRS announced it will issue automatic payments to eligible individuals who did not receive all of the Economic Impact Payments (EIP) they were eligible to receive, and who did not claim the Recovery Rebate Credit on their 2021 tax returns.
What Is the Recovery Rebate Credit?
The Recovery Rebate Credit is a refundable credit designed for individuals who did not receive an EIP, commonly referred to as a stimulus payment. Taxpayers could claim this credit on their 2021 tax returns if they were eligible for, but did not receive the full stimulus payment amount.
Who Will Receive the Payments?
Most taxpayers eligible for Economic Impact Payments have already received the funds or claimed the Recovery Rebate Credit. However, the IRS has identified a group of eligible taxpayers who:
- Were not issued stimulus payments initially, and
- Filed a 2021 tax return without claiming the Recovery Rebate Credit
Special payments, up to a maximum of $1,400 per recipient, will be sent automatically to these individuals from December 2024 – January 2025.
How to Claim the Payment:
No action is required for eligible taxpayers to receive these payments. If the taxpayer has already filed their 2021 tax return without claiming the Recovery Rebate Credit, and is eligible to receive stimulus money, the amount the taxpayer is eligible to receive will be calculated automatically.
Taxpayers who have not yet filed a 2021 tax return may still qualify to receive missed EIPs. To do so they must file their 2021 tax return by April 15, 2025 to claim the credit.
How and When Will Payments Be Issued?
The IRS began issuing payments in December 2024, with most recipients expected to receive their funds by late January 2025. Payments will either be sent automatically via direct deposited to the recipient’s bank account or by paper check through the mail. The IRS will send a letter to recipients confirming their eligibility and letting them know they will be receiving the payments.
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