IRS Sending Surprise Stimulus Checks: If you were a New York taxpayer eligible for the Recovery Rebate Credit in 2021 but didn’t claim it, you might be in for a surprise. The Internal Revenue Service (IRS) has announced that those who missed this credit on their 2021 tax returns will automatically receive payments by the end of January 2025.
Who’s Getting These Surprise Stimulus Checks?
The Recovery Rebate Credit is a refundable credit for individuals who didn’t receive one or more Economic Impact Payments (stimulus checks). If you mistakenly left the Recovery Rebate Credit blank on your 2021 tax return or entered $0 when you were eligible, the IRS has identified you as a recipient for this payment.
According to IRS Commissioner Danny Werfel, the agency discovered over one million taxpayers eligible for the credit but who failed to claim it. To simplify the process, the IRS is issuing payments automatically, eliminating the need to file an amended return.
How Much Are the Payments Worth?
The IRS has allocated a total of $2.4 billion for these payments, with eligible individuals receiving an average of $1,400 each. Payments will be sent either as a direct deposit to the bank account on file or as a check mailed to the address provided on your 2023 tax return. Checks began rolling out in December 2024, with most recipients expected to have their payments by late January 2025.
Can You Still Qualify?
If you haven’t yet claimed the Recovery Rebate Credit, there’s still time. Eligible taxpayers can file a claim on their 2021 tax return until April 15, 2025. The IRS is urging individuals to review their eligibility and watch for upcoming payments. Recipients will also receive a separate notification letter confirming the payment.
Tracking Your Tax Returns and Refunds
To check your tax records or refund status, you can access the IRS’s online tools:
- “Where’s My Refund” Tool: This service allows you to track refunds for the past two tax years.
- IRS Online Account: Review your past returns, notices, payment history, and address on file. If you’ve forgotten your login details, you can reset your password to regain access.
- IRS2Go Mobile App: This app lets you check the status of your refund and verify whether your return has been processed. To log in, you’ll need your Social Security number, filing status, and anticipated refund amount.
The IRS updates refund and return statuses daily, so check back regularly if you don’t see changes immediately.
IRS Funding Challenges and Their Impact
Recent government budget cuts have led to significant reductions in IRS funding, with $20 billion slashed from its budget. This underfunding has exacerbated the agency’s struggles to enforce tax compliance, contributing to an estimated $500 billion in unpaid taxes.
Critics argue that a poorly funded IRS disproportionately benefits larger businesses and cash-heavy enterprises, which have more opportunities to evade taxes. Strengthening enforcement and providing adequate resources could help recover unpaid taxes, reduce economic disparities, and ensure fair tax compliance.
FAQ
- Who qualifies for the Recovery Rebate Credit?
Anyone who didn’t receive one or more Economic Impact Payments and failed to claim the credit on their 2021 tax return. - How will payments be issued?
Payments will be sent automatically via direct deposit or mailed as a physical check. - Do I need to take any action if I’ve already filed my 2021 tax return?
No additional action is required if you’re eligible. The IRS will process your payment automatically. - When will I receive the payment?
Most payments will be distributed by the end of January 2025. - How can I track my refund or stimulus payment?
Use the IRS’s “Where’s My Refund” tool or the IRS2Go mobile app to monitor your payment status.