The IRS has started sending letters to around nine million households nationwide reminding Americans who have not yet filed their tax returns this year that they could be eligible for $1,400 stimulus checks — or even $2,800 checks for married couples.
Americans who haven’t yet claimed the third installment of stimulus payments that were sent out by virtue of the $1.9 trillion American Rescue Plan can still do so — if they file a 2021 tax return.
The plan, one of the first major pieces of legislation passed by the Democrat-controlled Congress and signed into law by President Joe Biden, included rental assistance, tax rebates, vaccine distribution funds, and direct payments to Americans who were struggling due to the coronavirus pandemic.
The federal government under the Trump administration began sending direct checks to Americans in the early days of the coronavirus pandemic, when state governors began mandating lockdowns and business closures to mitigate the spread of the virus.
Households should check their mailboxes for letters from the IRS, according to The Washington Post.
Americans can claim the third stimulus check even if they didn’t have an income last year — though there are income caps.
Those with an adjusted gross income — which is gross income minus certain adjustments — of $75,000 or less are eligible to get the full $1,400.
Those filing as head of household and earning at least $112,500 were not eligible for the stimulus payments.
Married couples who filed jointly and earned less than $150,000 were also eligible for stimulus checks as high as $2,800.
Taxpayers could also claim $1,400 checks for each dependent, which includes older dependents, college students, disabled adult children, or parents that are supported by their children.
Households that file a 2021 return could also be eligible for the expanded child tax credit and the earned-income tax credit.
The American Rescue Plan raised the earned-income tax credit from $543 to $1,502. Those with one child could earn up to $3,618 in earned-income tax credit, while those with two children can claim $5,980.
Households with three children would be eligible for an earned-income tax credit of $6,728.
The plan also raised the child tax credit to $3,600 for children 5 and younger and $3,000 for kids between the ages of 6 through 17. Before the pandemic, the child tax credit maxed out at $2,000 per child younger than 17.
“For 2021, for the first time, families can get the child tax credit, even if they owe no tax and even if they don’t have a job or business,” IRS spokesman Eric Smith told The Washington Post.
“This mailing was designed to reach people who didn’t file and mostly have modest incomes,” Smith said.
The IRS will make its “Free File” online program available to Americans until Nov. 17. The agency is urging filers to submit their returns electronically for maximum speed.
The agency on Tuesday announced inflation-adjusted tax brackets for next year — and the result could be that Americans will owe the federal government less because of soaring consumer prices.
The IRS put out a statement on Tuesday announcing that its tax brackets will increase by around 7% in an effort to offset record levels of inflation.
That means those whose wages have not kept up with inflation could be eligible to land in lower tax brackets — thus requiring them to pay less in tax.
