While Americans optimistically await signs that lawmakers will pass a bill authorizing a fourth stimulus check, there are still potentially millions of people waiting for some of the money from the previous stimulus to hit their homes. Bank accounts.
Unfortunately, the IRS is behind in processing 2020 tax returns, which could affect the ability of many taxpayers to receive the full amount of stimulus payments owed to them. Here’s what you need to know.
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IRS arrears led to underpayments of stimulus money
According to a recent report by Taxpayer Advocate ServiceThe IRS has a large number of tax returns still waiting to be processed. In fact, there are believed to be around 35 million returns submitted by individuals and businesses waiting to be manually processed by an IRS employee.
Pending returns include 16.8 million paper tax returns that have not been processed at all. It also includes 15.8 million returns that the IRS has started processing, but that will require further review by an agent. And it also includes 2.7 other amended returns that the IRS hasn’t even reviewed yet.
The IRS has such a large backlog because so many IRS officers were placed on evacuation orders during the COVID pandemic. Workers were unable to visit IRS facilities to process these returns in a timely manner.
Unfortunately, this has left a large number of people waiting for refund checks – and waiting for stimulus funds. You see, while many people received their payments by direct deposit or by check, the IRS did not necessarily have the correct contact information for everyone or specific details on the number of dependents and the amount of. money they were entitled to.
Taxpayers who did not receive the correct amount of stimulus checks were able to claim them on their 2020 taxes. This was called the request for a recovery rebate credit. And the IRS has estimated that more than 8 million people are eligible to claim these credits.
Unfortunately, many of these people may have their tax returns pending. And until the IRS reaches those returns, they’ll be waiting for the stimulus money that’s supposed to help them deal with the financial consequences of the pandemic.
Taxpayers whose returns are still pending can use tracking tools on the IRS website to determine the status of their return and refund. You will need to provide your Social Security number, filing status, and the exact amount of your pending tax refund in order to use this tool.
Unfortunately, there isn’t much you can do except wait for the IRS to process your return if your stimulus payments are still pending. “For taxpayers who can afford to wait, the best advice is to be patient and give the IRS time to deal with their backlog,” the National Taxpayer Advocate wrote in its mid-year report. in Congress.
If you’re hoping for more immediate relief, you can also check out other federal and state benefits that may be available in the meantime.