More State Stimulus Checks This Month: IRS Reaches Out To Over 9 Million As November Deadline Looms

Stimulus check
Stimulus check

Inflation continues to assail low-income Americans as federal stimulus checks elude low and moderate-income groups for the whole of 2022. The record inflation has put even basic goods out of the reach of Americans and only state inflation relief has been forthcoming this year.

While over 21 states have stepped in to help out residents beset by the rise in prices that has affected everything from groceries to gasoline. But over 9 million Americans are also in line for federal stimulus checks and will only have to follow a few simple steps to claim what is rightfully theirs.

It is especially important to reach out to low and moderate-income people who lived paycheck-to-paycheck and did not have the backup to last through trying times, not during the pandemic, and neither during the economic fallout of the record inflation that has placed even essentially out of the reach of millions.

The IRS and the Treasury struggled through the pandemic to quickly get pandemic relief payments to individuals and families. The IRS relied on their data that was limited to income tax filings by individuals and couples.

People who were not required to file income tax returns because of their income were left out. Other issues that worked against them were families with low or no internet access, or the homeless. Such individuals and families were left out as the IRS had no records of them in their data.

But relief might be imminent for these individuals and families. Individuals with very little income, and thus not required to pay taxes have until November 15 to complete their application and collect their stimulus check.

Between April 2020, the period immediately after the pandemic struck, and December 2021, sent stimulus checks of $931 billion to individuals and households. The three rounds of stimulus checks were followed by the extended unemployment checks and the expanded Child Tax Credit stimulus checks.

The three rounds of direct stimulus check payments benefitted around 165 million eligible Americans. The income generally went to individuals with an adjusted gross income of $75,000 or less while for a married couple it was $150,000. The payments were decreased on a sliding scale and individuals with income above $80,000 and couples with an AGI above $160,000 did not receive any federal payments.

The federal administration also temporarily expanded the Child Tax Credit (CTC) and included more families while increasing the amount from $2,000 to between $3,000 and $3,600 depending on the age.

Most families with children automatically qualified for the CTC as they file their income tax returns, though other eligibility requirements remain.

Outreach Steps Taken By The IRS And The Treasury

The IRS and the Treasury have taken sweeping outreach to communicate the approaching final date for submission of papers to collect the COVID-19 and the expanded Child Tax Credit payments. But millions remain outside the reach and have faced various obstacles in collecting their stimulus checks.

They include people who have never filed income tax returns before as their income is below the minimum required to file tax returns. Many have filed for the first time and have faced difficulty in the generally complicated nature of tax filing.

People have been put off as they do not have bank accounts and lack access to banks and have also been unable to access the stimulus checks. families with mixed immigrant status and the homeless were mostly left out of the stimulus payment despite immigrants being eligible for payments under the economic impact payments.

People with limited internet connectivity also faced issues while applying for stimulus cards.

The biggest hurdle faced by the IRS was that their data was limited to those who filed income tax returns earlier. The stimulus checks were primarily intended for the low-income groups, and it is this section of the population that got left out of the payments as no record was with the IRS.

In May 2021, the Treasury Inspector General has finally identified around 10 million individuals eligible for the stimulus checks. Steps were identified for the IRS to conduct outreach programs and communication efforts primarily to the underserved communities.

Individuals And Families Can Also Reach Out For Stimulus Checks

All families and individuals who have not received their stimulus checks but realize that they might be in line for any one or more of the payments on offer from the federal administration.

The amount is expected to be substantial and could run into several thousands of dollars for the multiple federal schemes that an individual or family may have failed to collect. Individuals and households with minimum income that doesn’t entail them to file income tax returns are in the most danger of missing out on the payments and have until November 15 to file a simplified return and collect their payments.

The deadline for regular taxpayers expired after the extended deadline on October 17.

Many Non-Filers Became Eligible For Stimulus Checks For The First Time

The most challenging part of the Treasury and the IRS is to get payments to the non-filers and those not required to file tax returns. These people were eligible for the payments for a couple of reasons.

They were no requirement for a person to have an earned income to be eligible for the stimulus check. Americans will little or no income could still qualify for the stimulus check and the Child Tax Credit payments.

The payments were also refundable tax credits and eligible individuals could claim the full amount even where it exceeded the amount they owed as taxes.

The authorities used other sources of data to identify and reach out to the 9 million and more potential eligible non-filers.

Another 10 million potential individuals were identified by the US Treasury Inspector General for Tax Administration (TIGTA) as eligible for payments, but IRS has not moved to reach out to these individuals.

Other measures have also helped. For instance, the IRS and Treasury expanded their partnership and educated more people about stimulus checks.

The IRS found that the effectiveness of the outreach program can be improved by changing its method. Underserved communities including first-time filers, non-filers, mixed immigration status families, families without bank accounts, and families with no internet access were likely to be left out of the stimulus check program.