Over the last couple of years during the time of the Covid response actions in the US, the US government was giving out money – a lot of money – to many people who had been impacted with job closings and more. Now, this is the last chance for over 9 million people and families to claim the stimulus money, extra Child Tax Credit money, Earned Income Tax Credit, and more.
Last Chance to Claim Stimulus Money
The IRS has been sending out letters this month to over 9 million people and families who had qualified for one of the many rounds of stimulus payments but had not claimed them. The reason they were not claimed was because those individuals had not filed a 2021 federal income tax return. Many people are not required to file a tax return but those same people would also have not been able to get the stimulus money that was waiting for them.
The IRS is leaving the Free File website open until November 17 for those that wish to file a 2021 federal income tax return to claim that stimulus money and more. The government says that it could be many low income individuals that have not filed and therefore were unable to claim the stimulus money that would have been coming their way.
The IRS had done a similar mailing back in September of 2020 to likely the same 9 million people and families about claiming it. The IRS does say that even if you have not received a letter yet and have not filed a 2021 federal tax return, you can still do that now. In fact, there will not be a “penalty for a refund claimed on a tax return filed after the regular April 2022 tax deadline”, according to the IRS.
Here are the various credits and payments that you may have qualified for but not received due to not filing a federal tax return:
- An expanded Child Tax Credit: Families can claim this credit, even if they received monthly advance payments during the last half of 2021. The total credit can be as much as $3,600 per child.
- A more generous Earned Income Tax Credit: The law boosted the EITC for childless workers. There are also changes that can help low- and moderate-income families with children. The credit can be as much as $1,502 for workers with no qualifying children, $3,618 for those with one child, $5,980 for those with two children and $6,728 for those with at least three children.
- The Recovery Rebate Credit: Those who missed out on last year’s third round of Economic Impact Payments (EIP3) may be eligible to claim the RRC. Often referred to as stimulus payments, this credit can also help eligible people whose EIP3 was less than the full amount, including those who welcomed a child in 2021. The maximum credit is $1,400 for each qualifying adult, plus $1,400 for each eligible child or adult dependent.
Besides these three credits, many filers may also qualify for two other benefits with a tax return filed for 2021:
- An increased Child and Dependent Care Credit: Families who pay for daycare so they can work or look for work can get a tax credit worth up to $4,000 for one qualifying person and $8,000 for two or more qualifying persons.
- A deduction for gifts to charity: Most tax-filers who take the standard deduction can deduct eligible cash contributions they made during 2021. Married couples filing jointly can deduct up to $600 in cash donations and individuals can deduct up to $300 in donations. In addition, itemizers who make large cash donations often qualify to deduct the full amount in 2021.
So, if you think you have not received any/all of the money that had been going out from the federal government last year, there is still time – if you qualify. Just make sure you file your 2021 federal tax return, even if you are not obligated to do so, in order to receive any or all the credits that you qualify for.