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Tuesday, December 6, 2022

IRS Stimulus Check Filing Extension Deadline Looms On November 17

All three rounds of federal stimulus checks have been issued by the IRS and the overwhelming majority of Americans have received their Economic Impact Payments. But even a tiny fraction who missed out on the payments for multiple reasons constitute a huge number, over 9 million according to the IRS. 

And to enable such people to claim the benefits that they missed, the administration has without charge kept the online tool, Free File, open for another month until November 17, 2022.

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At the same time, state stimulus check payments continue to go out with the bulk of the Middle-Class Tax Rebate payments being sent by the Golden State.

Close to 10 million American individuals and households could lose out on thousands of dollars each by failing to claim their pending 2021 tax credits. To facilitate the maximum number of people getting information about the impeding last date, the IRS has ramped up outreach to the millions of individuals and families who have failed to collect their dues.

Millions Could Lose Out On Thousands In Federal Tax Credit Stimulus Checks

The IRS has sent out a letter to those it has identified as people who could miss out on substantial sums of payment in the form of tax credits that could come as a big boost amid record inflation rates.

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The money that people have failed to claim to include the third stimulus check, sanctioned under the American Rescue Plan Act, that alone was worth up to $1,400. There is also the Child Tax Credit, worth between $3,000 and $3,600 per child depending on their age, and the earned income tax credit of up to $1,502 per childless worker that can go up to even $6,728 for filers will three children or more.

It is worth noting that families who have already received their advance monthly CTC payments in 2021 for 50% of the value of that credit, will have to claim the remaining value of their credit by filing their returns for 2021 by the cutoff date.

Beneficiaries who opted for it received a monthly stimulus check against the expanded Child Tax Credit that was increased from $2,000 to up to $3,600. The monthly checks varied between $250 and $300 for each child.

Families received $250 per month for children between 6 and 17 years and $300 per month for children below 6 years.

The American Rescue Plan Act was enacted in 2021 as the incoming President signed the bill in March that immediately sanctioned a host of measures that included the third stimulus check and support to businesses, and local, tribal, and state governments.

The Arc Helped People Claim Stimulus Check Without Filing Returns

The ARPA authorized the economic impact payments through the Recover Rebate Credit. The RRC 2021 reduced any tax you owe for 2021 or for that to be added to an individual tax refund.

For most individuals who did not get the third stimulus check or those who received only a partial check, they could claim it through the recovery rebate tax credit when their filed their 2021 income tax returns, to be filed in 2022.

For millions who have missed out on the payments, the date has been extended to November 17. The Recovery Rebate Tax Credit and the stimulus checks are linked. The third stimulus check that includes the plus-up payments were simply advance payments of the credit.

So if the combined sum of any beneficiary’s economic impact payment and any subsequent plus-up payment was less than the recovery rebate credit amount allowed, they could claim it and get the difference back on their 2021 income tax return as a lower tax bill or a larger refund in taxes.

If the third stimulus check exceeds the credit amount, beneficiaries would not need to pay the difference. This helped eligible people who did not get the full amount or did not receive the third stimulus check.

In many cases, even the person who received the $1,400 payment in the third round of payment is eligible to claim a recovery rebate credit that boosts the refund or even reduces the taxes that they owe.

So even those who are not required to file a tax return for 2021 should check to see if they qualified for the RRC. If they do, they should move ahead and claim the credit to claim their refund.

Claiming The Credit Stimulus Checks Before The Deadline In November

The services will help those who are not mandated to file income tax returns but they will have to keep the November deadline in mind.

The IRS Free File will be active till the final date which is November 17. The date has been extended by a month and will allow eligible people to file free returns through a partnership between the tax software industry and the IRS. To gain access to the service, a filer must have an adjusted gross income of up to $73,000.

ChildTaxCredit.gov is another online tool that allows both individuals and families to file their income tax return for 2021 and claim their economic impact payment or the full or partial child tax credit payments for which they may be eligible. The tool is also available to people without children.

The GetCTC.org will also allow filers to use a simple tool to claim their economic impact payment, the earned income tax credits (EITC), and the CTC stimulus check through November 15. This tool was provided by Code for America and was updated to include the EITC.

The IRS Volunteer Income Tax Assistance Program also assisted people who need help in navigating the online tax-filing process. People need to end the income restrictions apply to qualify for assistance.

To be sure, tax filers generally get up to 3 years from the original date of filing to claim the tax credit for which they are eligible. But these simplified tools aim to streamline the claiming process for those who are not normally required to file. Following the deadline in November, even those who could not file the returns will still get to file the 2021 income tax returns.

The tax authorities have urged filers to keep ready certain forms before they make their claim. This will make the process easier. That includes 1099s and W-2s and also letters that the IRS issued that showed total CTC stimulus check payments and the total economic impact payment.

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