The Internal Revenue Service (IRS) will begin automatic payments of the Recovery Rebate Credit (RRC) later this month to taxpayers who qualified but did not receive it.
RRC is a program designed for taxpayers who missed out on receiving their Economic Impact Payments (EIP). The IRS announced in a press release on December 20 that it will identify taxpayers who were eligible for the RRC but did not claim it, and will provide payments—either by direct deposit or paper check—through the end of January next year, without requiring an additional application.
The IRS estimates that about one million taxpayers who were eligible for up to $1,400 did not claim the credit, resulting in a total of $2.4 billion in unclaimed funds. The agency noted that these rebate credits are not considered taxable income and do not affect eligibility for federal assistance programs such as WIC (Women, Infants, and Children).
IRS Commissioner Danny Werfel stated, “T“The IRS continues to work hard to make improvements and help taxpayers. These payments are an example of our commitment to go the extra mile for taxpayers. Looking at our internal data, we realized that one million taxpayers overlooked claiming this complex credit when they were actually eligible. To minimize headaches and get this money to eligible taxpayers, we’re making these payments automatic, meaning these people will not be required to go through the extensive process of filing an amended return to receive it.”