Federal Stimulus Checks Could Still Get You Thousands Of Dollars: Over 9 Million Letters From IRS Remind People To Collect Pandemic Relief

Stimulus Check

The IRS has sent out letters to millions of non-filers reminding them to file for their federal stimulus checks before the last date on November 17. The letters are intended to clear confusion on several issues among non-filers and also to combat fraud. With inflation stressing the budget of low and moderate-income citizens, families could do with some extra cash.

The prices of rent, food, gasoline, and utilities continue to show record increases and the money for which the IRS is sending out reminders could run into thousands for millions of families. All they have to do is fill out their income tax returns for 2021, something that should in the normal course be done within April of any year.

For those who have received a letter, but are struggling to file their income tax return, rest assured that the process has been made very simple on the IRS site.

The money for which the IRS is sending out letters income the third stimulus check, or the Economic Impact Payment, which was alone worth $1,400 per individual, and several lucrative tax benefits including the Earned Income Tax Credit and the expanded Child Tax Credit stimulus check.

The CTC stimulus check that was for the benefit of children could alone be worth over $7,200 for families with two children and who have not collected the initial 50% of the amount through monthly stimulus checks between July and December 2021.

The Stimulus Check Payable By The Federal Government Is Linked To The 2021 Income Tax Return

But to claim all these funds you first need to submit your income tax returns for 2021. This applies to even those who normally do not need to file tax returns as their earnings are below the taxable limit.

The third stimulus check was the highest of the three stimulus checks sent out post the pandemic starting in April 2020. And you do not have to have any income for 2021 to qualify for the stimulus check. but there are caps on income.

The IRS has faced an uphill task during the pandemic and after reaching out to millions of people who do not file income taxes as they are exempted due to their income and other factors. Technically the IRS considers the stimulus checks as an advance of credits that are referred to on Forms 1040-SR and 1040 as the Recovery Rebate Credit.

For the Economic Impact Payments that were part of the American Rescue Plan Act signed by incoming president Joe Biden in March 2021, individuals with a federal adjusted gross income of $75,000 or less were entitled to the full amount of $1,400 for each filer or dependent.

The ceiling was $112,500 for individual filers filing as household heads, and $150,000 for couples filing jointly. The AGI is considered the gross income for the taxable year less certain adjustments that are allowed under the law.

The amount claimed for dependents was the same $1,400. The relief was extended to cover older dependents, including dependent college students, parents who were supported, and disabled adult children.

Other than the stimulus checks, households who filed their income tax returns from 2021 are also eligible for the expanded Child Tax Credit stimulus check, and the earned-income tax credit (EITC).

For filers without children, the Rescue Plan has nearly tripled the EITC, raising it from $543 to a generous $1,502. The credit can come to as much as $3,618 for those with one child, $5,980 for those with two children, and $6,728 for those with three children.

CTC Stimulus Check Alone Could Be Worth Thousands For Families 

The CTC stimulus check was also increased from $2,000 to $3,600 for children below six years and $3,000 for those between six and seventeen years. This is also the first time that the upper age limit was increased from sixteen to seventeen.

The child tax credit was first given in 1997 and has always been a great help for families with children. It has meant keeping the child out of poverty and providing the food and other needs of a growing child. 

The only difference for the post-pandemic child tax credit stimulus check was the boost the fund received in 2021 under the American Rescue Plan Act. It went up from $2,000 for children under 17 years to up to $3,600 for children under six years.

And for the first time in 2021, families received the child tax credit even if they owed no tax and even if they did not have any source of income such as a job or a business income. This was disclosed by Eric Smith, the IRS spokesman.

The IRS has specifically urged foster parents, grandparents, caretakers of siblings, and any other relative who is in charge of children to their eligibility for the Child Tax Credit of 2021.

The Child and Dependent Care Credit, which is not the CTC stimulus check, has also been expanded and more people are now eligible. The total credit is now worth $4,000 for a qualified individual and doubles that for two or more individuals.

The letters sent by Revenue Services will reach the mailboxes of people who are qualified but have failed to file their income tax returns for 2021. The Office of Tax Analysis under the Treasury Dept. has identified individuals who are not normally required to file their income tax return because of their low income.  The department referred to W-2s and 1099s, and also 3rd-party statements revealed the IRS. Officials said the letters were destined for people with a modest income who did not file income tax returns.

The IRS has enabled such people to file their returns quickly and conveniently through the Free File, the agency filing program at irs.gov which will remain accessible till November 17 at midnight, Eastern Time. The fastest and most convenient way to file an income tax return and quickly claim the credits is to file electronically. Those with an AGI of $73,000 or less should use the Free File with brand-name software.

The IRS also said that people with income below $12,500 as individuals and double that as married couples can also access the childtaxcredit.gov/file to file a tax return.

Those who missed their filing period can also file paper returns though there will naturally be a delay in the whole process.

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