The Internal Revenue Service (IRS) began sending around 169 million Americans a third Economic Impact Payment (EIP), or stimulus check, after Democrats passed the American Rescue Plan in March 2021. That direct payment to taxpayers was for up to $1,400 for every eligible man, woman and child, to boost household finances in light of the continuing covid-19 pandemic, but not all of those who were eligible received a payment.
The IRS automatically sent out payments based on the information they received from taxpayers, either through an online portal for Non-Fliers or from 2019 or 2020 tax returns. Anyone who the tax agency was unaware of would not have received a payment, but when the 2022 tax season rolls around that oversight can be remedied.
Filing a 2021 tax return in 2022 could mean thousands of dollars for taxpayers
The American Rescue Plan included a raft of tax provisions to help struggling households across the United States. Most prominently was the third stimulus check, this time for $1,400. But other measures specifically targeted households with children and dependents, including the 2021 Child Tax Credit, the Child and Dependent Care Credit and the Earned Income Tax Credit. The final one can also be claimed by workers who don’t have a child or dependent.
Taxpayers who had not filed a tax return in the previous three years or failed to provide their information through the Non-Filer online portal were left out of all three EIPs. Another group that is specifically missing the third stimulus check are families that welcomed a new member to their household. When they file their 2021 tax return next year, they will be able to claim the payment, as the IRS will now have the new information proving their eligibility.
Along with claiming the third direct payment, or other EIPs, Americans that file a 2021 tax return in 2022 could possibly qualify for the other enhanced tax provisions. These could add up to thousands more off any taxes owed or even in the form of a larger tax return. One such is the 2021 Child Tax Credit which would give parents to up to $3,600 for their new born, or each child adopted under age six and as much as $3,000 for each child six to 17 that wasn't already claimed as a dependent on a taxpayer's filing for 2020.
Claiming the $1,400 stimulus check
Families that either had a newborn or adopted a child in 2021 will be able to claim the amount of the third Economic Impact Payment (EIP3) they are due through the 2021 Recovery Rebate Credit. This goes for all taxpayers who didn’t get the full amount due to them from the direct payment scheme.
You’ll want to check any documentation that the IRS sent regarding the EIP3 or “plus-up payments” received. If you lost the letter that the agency sent, through the IRS website you should be able to find the information in your federal tax account. If you try to claim more of the credit than you are due, it could delay processing of your tax return and thus your refund if you have one coming.
Taxpayers that are still missing the first two Economic Impact Payments (EIP1 and EIP2) will need to file a 2020 1040 to claim the 2020 Recovery Rebate Credit
Eligibility for third stimulus check
The income requirements are the same as those for the three stimulus checks passed by Congress. A single tax filer must make under $75,000, $112,500 as a Head of Household filer, or less than $150,000 for married couples who file jointly. However, the phaseout above those thresholds was faster than the previous two rounds, with a cutoff for eligibility at $80,000 for single filers, $120,000 for Head of Household filers, and $160,000 for married couples who file jointly.