This year, many Americans might qualify for tax extensions, but they risk missing out on a $1,400 stimulus check if they wait too long.
It is estimated that over a million Americans remain eligible for the stimulus checks that the U.S. government distributed in 2021.
Importance of the Issue
The Recovery Rebate Credit provides $1,400 and was initially created to assist Americans during the economic challenges posed by the coronavirus pandemic. Unfortunately, millions of eligible individuals did not file their taxes that year and, as a result, missed out on these payments.
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Key Information
An IRS spokesperson informed Newsweek that April 15 is the cutoff for all Americans to claim their 2021 stimulus payment.
This applies to Americans who qualify for an extension this year, as any unclaimed stimulus payment will revert to the Treasury after April 15. This is the three-year federal statute for Americans to recoup any tax refunds.
Those who file on time will receive their payments either via paper check or direct deposit based on the banking details provided on their 2024 tax returns.
The exact amount received will depend on their adjusted gross income, with the full $1,400 available for individuals whose adjusted gross income did not exceed $75,000 in 2021.
For married couples, this cap increases to $150,000 for the 2021 tax year.
The IRS estimates that over 1.1 million Americans have refunds totaling more than $1 billion combined. Those who have already claimed the tax refund in previous years are ineligible to do so again.
Public Opinions
Kevin Thompson, a finance expert and founder and CEO of 9i Capital Group, shared with Newsweek: “The critical aspect of the Recovery Rebate Credit is its refundable nature—meaning you can receive the credit even if you owe no taxes. Unlike other credits and rebates that only lower your taxable income to zero, refundable credits exceed what you owe, and the surplus is returned to you as a refund.”
Alex Beene, a financial literacy instructor at the University of Tennessee at Martin, mentioned to Newsweek: “While it’s unfathomable for the millions of Americans who received stimulus checks during the pandemic, there remains a small segment of taxpayers who qualified for payments but never received them.”
Next Steps
If Americans do not claim the Recovery Rebate Credit by April 15, they will lose the money, which will revert to the U.S. Treasury. Individuals with extensions who are due these funds must still file their tax returns by their deadline to avoid any penalties.
