The coronavirus stimulus checks may be in their final weeks but it appears that the Internal Revenue Service has come through in a big way to financially assist millions of still-struggling Americans.
The agency announced this past weekend that more than 2.8 million refunds for 2020 unemployment benefits were sent out to eligible Americans. To date, the IRS has confirmed that it has reviewed more than 3.1 million returns, with more than 2.8 million receiving refunds. It added that it plans to issue the next batch of refunds in mid-June.
Be aware that there is little to worry about for those who have already filed their taxes, as the IRS has indicated that it will automatically adjust tax returns if individuals qualify for the unemployment refund.
“Because the change occurred after some people filed their taxes, the IRS will take steps in the spring and summer to make the appropriate change to their return, which may result in a refund,” the IRS stated.
According to the most recent release, “taxpayers will receive letters from the IRS, generally within thirty days of the adjustment, informing them of what kind of adjustment was made (such as refund, payment of IRS debt payment or payment offset for other authorized debts) and the amount of the adjustment.”
The IRS has stated that roughly ten million Americans likely overpaid on their unemployment taxes last year and could be set to receive refunds.
A recent Treasury report seems to support those claims—as more than seven million tax returns already processed qualify for the refunds. “Of the 7.4 million tax returns, nearly 7.3 million—or 98.6 percent—had modified adjusted gross income of less than $150,000 and would likely qualify for the exclusion,” according to the report.
In recent weeks, millions of Americans have shown their frustrations over the slow rollout of the refunds—and adding to the confusion was that the IRS has provided few updates on the ongoing delays. Some individuals have even launched Twitter and other social media pages to keep tabs on when eligible taxpayers can expect to get their hands on the refund money.
Know that these new cash windfalls are from President Joe Biden’s $1.9 trillion American Rescue Plan, which was able to waive federal tax on up to $10,200 of unemployment benefits—or $20,400 for married couples filing jointly—that were collected by taxpayers last year.
Current estimates indicate that for single taxpayers who are eligible for the $10,200 tax break and fit into the 22 percent tax bracket, they could potentially take home a sizeable sum of $2,200. That amount would double for eligible married couples.
Ethen Kim Lieser is a Minneapolis-based Science and Tech Editor who has held posts at Google, The Korea Herald, Lincoln Journal Star, AsianWeek, and Arirang TV. Follow or contact him on LinkedIn.