If you are used to receiving a refund check from the US Treasury After filing your individual tax return with the Internal Revenue Service, you may be surprised this year that you continue to receive checks or direct deposit payments. What's going on? The IRS is still sending round three stimulus payments, additional stimulus payments for those who fell short, refunds of unemployment compensation taxes, as well as advance payments of the child tax credit. It's like the IRS is an ATM. Here's how to check that you are getting what is rightfully yours.
Stimulus payments. The Internal Revenue Service announced today that it has paid more than 2.2 million stimulus payments (also known as economic impact payments) in the past six weeks, pumping another $ 4 billion into the economy. The latest payments bring the total number of payments to more than 171 million, with a total value of more than $ 400 billion, authorized under the March Covid-19 rescue plan, the American Rescue Plan. Here are the stimulus payments of $ 1,400 per person: Single taxpayers with adjusted gross income up to $ 75,000 and married filers who file jointly with adjusted gross income up to $ 150,000 get a total of $ 1,400 (receive a partial payment with income up to $ 80,000 / $ 160,000). Dependents also receive full payments of $ 1,400.
In this latest round of payments, about 1.3 million went to people who recently filed a tax return, and more than 900,000 supplemental or additional payments went to people who received payments based on their 2019 tax returns but were eligible. for a new or larger tax return. payment based on your recently processed 2020 tax returns. Unemployment compensation tax refunds. The IRS announced last week that it was distributing another round of refunds to nearly 4 million taxpayers who overpaid their taxes on unemployment compensation received in 2020. The average refund is $ 1,265. That adds up to 2, 8 million of these refunds that have been made so far. An estimated 13 million taxpayers owe unemployment compensation tax refunds.
Why Special Unemployment Tax Returns? In the American Rescue Plan, Congress made up to $ 10,200 of 2020 unemployment benefits nontaxable. In general, unemployment benefits are taxable, including basic state benefits, as well as the additional federal pandemic benefits of $ 600 per week from the CARES Act. If you received unemployment benefits in 2020, you should have received a Form 1099-G showing the amount you were paid and the federal income taxes withheld. You do not need to request a revised form. Instead, the IRS is making automatic corrections based on the new $ 10,200 exclusion.
Child Tax Credit Advance Payments The American Rescue Act included an enhanced child tax credit and advance payments (of half the credit) to all eligible families. The first batch of monthly advance payments worth about $ 15 billion reached about 35 million families last week. Approximately 86% was sent by direct deposit. Each payment is up to $ 300 per month for each child under age 6, and up to $ 250 per month for each child ages 6 to 17. (High-income people get much less, for example, a married couple with incomes close to the $ 440,000 limit would get $ 3 monthly payments.) Typically, anyone who receives a payment in July will also receive a payment each month for the remainder of 2021 unless they cancel their enrollment. Be careful: the advance is just that, an advance, which means you will owe more or receive a smaller refund next year when you file your 2021 tax return.
The IRS is still trying to reach the neediest families. This weekend it will host a second set of free tax preparation days for people who don't normally file taxes, so they can get paid upfront.