The IRS has a message for people still waiting for federal stimulus payments: the money is already on the doorstep.
The tax agency said this week that it has sent more than 160 million checks ($ 1,200 for adults and $ 500 for children) directed by the Coronavirus Economic Aid, Relief and Safety Act (CARES), which represented the first round of stimulus payments sent to most American households. As of December, it also sent more than $ 147 million in payments for the second round of checks, which offered $ 600 for each eligible adult and child.
Certainly Congress is currently negotiating another round of stimulus aid, which could be aimed at a third check to eligible households. If lawmakers approved this $ 1.9 billion relief effort, President Joe Biden could turn it into law in late March, according to Wall Street analysts. In that case, the IRS would be allowed to distribute a third round of checks. So far, the tax agency has been allowed to send two rounds of checks and said all of these payments have been mailed or deposited in bank accounts.
In all, the IRS has disbursed more than $ 410 billion in so-called economic impact payments, an emergency aid to help people leave during the pandemic, in American homes since April. While these checks have been handed out to most eligible people, the IRS has struggled to reach some of the most financially vulnerable Americans, such as those who do not have bank accounts or do not earn enough money. to file tax returns.
These issues have complicated the distribution of the stimulus check because the IRS relies on a person’s most recent tax return to determine if they are eligible for payments, as well as to determine where to send the money.
“That was a big problem: those people who meet the requirements but don’t file a statement,” and therefore not on the IRS’s radar, said Jody D’Agostini, a certified financial planner at Equitable Advisors. Some of the people who got lost are those who probably need the most money for the stimulus, he added.
Although the IRS said all checks have been issued, it added that some checks could still be in the mail. And if you haven’t received either or both of the stimulus payments, or haven’t received the right amount, you’ll have another chance to claim the money when you file your 2020 tax return, according to the agency.
“If individuals have not received any payment (or if they have not received the full amount), they may be eligible to apply for the recovery bonus credit and must file a tax return by 2020,” he said. tax agency in a statement.
This could happen if someone’s income falls in 2020, based on the experience of the millions of Americans who lost their jobs or lost their jobs last year. “Some people didn’t qualify through the 2018 and 2019 tax returns, but then they had a horrible 2020 and didn’t get the check, but they were really eligible,” D’Agostini said. These people can claim payment by filing a 2020 tax return.
“Financial Anxiety”
Some critics have criticized the IRS for its distribution of stimulus payments, with national taxpayer attorney Erin M. Collins asking the agency not to make sure checks reached everyone. eligible. Households that did not receive their checks “are likely to suffer financial difficulties now,” Collins wrote in a report to Congress last month.
In his view, taxpayers should not have to wait to file their 2020 tax returns in early 2021 to get their payments. Unfortunately for those who got lost, the IRS now offers no other option. It was said that people who failed to pay or did not receive the right amount will have to wait until they file their 2020 tax return to claim the extra money.
How to claim your incentive money
The first step is to find out how much you will need to claim on your 2020 tax returns for missing stimulus payments.
The IRS, which began accepting tax returns on Feb. 12, describes the checks as “recovery bonus credits” on its tax forms. This is because technically the payments were actually tax rebates paid before filing your taxes.
To help you determine if you owe more, the IRS released a Recovery Recovery Bonus Spreadsheet, which asks you questions about eligibility (such as your income) and how much you received in both stimulus controls so far. If you think you owe more, you can enter the amount on line 30 on Form IRS 1040.
If you do not remember the amount you received during the first two rounds of stimulus payments, you can create or view your account on the IRS website. Additional incentive money will be included with the tax refund. Most taxpayers will receive the refund within 21 days, according to the tax agency.
With Congress now working on one third relief package, millions of households could receive a third stimulus control in the coming weeks, falling in the middle of the tax filing period.
People who lost income in 2020 or who had a baby last year may want it file your taxes as soon as possible to make sure they get the right amount at the next stimulus check. Otherwise, the IRS could rely on the 2019 tax returns to determine eligibility.
If this happens, people may have to wait again until they can update their information with the IRS and claim their additional incentive money.