IRS Sending Out Letters Regarding Stimulus Checks
January 10, 2022
The IRS announced it will be sending out letters starting in late January 2022 to individuals who received the third Economic Impact Payments (COVID Stimulus Checks) that were paid back in March 2021.
The amounts paid were technically advance payments of a fully refundable tax credit otherwise known as the ‘2021 Recovery Rebate Credit’. The stimulus payments are not taxable, but these amounts do need to be reported on your 2021 income tax return. Since these payments were paid in advance based on prior year income tax numbers, the estimated amounts need to be reconciled on the 2021 return to verify that the correct amount was paid.
If you receive one of these letters please forward it to your tax advisor, so they have the information needed to correctly reconcile and report this on your 2021 tax return. Please do not hesitate to contact our office if you have any questions.
Gatto, Pope & Walwick, LLP
Certified Public Accountants