The Internal Revenue Service (IRS) has confirmed it will issue automatic stimulus payments of up to $1,400 per individual to 1 million eligible taxpayers. These payments, scheduled for distribution by late January 2025, aim to assist those who failed to claim the Recovery Rebate Credit on their 2021 tax returns. This initiative will help taxpayers who missed out on previous stimulus payments receive the financial relief they are entitled to.
Who Will Receive the Automatic Stimulus Payments?
The IRS is sending payments to taxpayers who qualified for the Recovery Rebate Credit in 2021 but did not claim it on their tax returns. The payments will be delivered automatically, either through direct deposit or paper check. Eligible recipients include:
- Single Filers with an adjusted gross income (AGI) of $80,000 or less.
- Heads of Household earning $120,000 or less.
- Married Couples Filing Jointly with an AGI of $160,000 or below.
Additionally, payments will be issued for qualifying dependents at a rate of $1,400 per dependent.
No Action Required for Eligible Taxpayers
Taxpayers who filed their 2021 returns but did not claim the Recovery Rebate Credit will automatically receive their payments. The IRS has assured that no additional forms or applications are necessary. Payments will be made via direct deposit if banking details were provided on the 2021 return; otherwise, paper checks will be mailed to the address on file.
Understanding the Recovery Rebate Credit
The Recovery Rebate Credit was introduced as part of the federal government’s COVID-19 relief measures, providing direct payments to eligible taxpayers. It is a refundable tax credit, meaning even taxpayers with little or no tax liability can receive the payment. Despite the availability of this credit in 2021, many taxpayers either overlooked it or were unaware they were eligible. The IRS’s current initiative aims to resolve that issue by issuing payments automatically to those who missed out.
Payment Amount Breakdown:
- Individuals: Up to $1,400
- Married Couples (Joint Filers): Up to $2,800
- Dependents: $1,400 per qualifying dependent
For example, a married couple filing jointly with two qualifying children could receive up to $5,600 ($2,800 for the couple plus $2,800 for the dependents).
How Payments Will Be Distributed
The IRS has outlined the following payment methods:
- Direct Deposit: Payments will be sent directly to the bank account listed on the taxpayer’s 2021 tax return.
- Paper Check: If no direct deposit information is available, the IRS will mail a check to the address on file.
Payment Timeline:
- Direct Deposits: Most will arrive within a few weeks of issuance.
- Paper Checks: Delivery may take longer, depending on mail processing times.
Tracking Your Stimulus Payment
Taxpayers can monitor their payment status using the IRS’s “Get My Payment” tool, available on the IRS website. The tool provides real-time updates on payment processing and expected delivery dates.
What If You Don’t Receive Your Payment?
If you believe you are eligible but do not receive your payment by mid-February 2025, follow these steps: