The Internal Revenue Service (IRS) announced plans to issue automatic payments to eligible taxpayers who did not claim the clawback refund credit on their 2021 tax returns.

IRS officials announced the move on Dec. 20 and said payments will be made automatically before the end of December. An analysis of the agency that found approximately follows 1 million taxpayers did not claim the pandemic-related credit on their 2021 return when they were eligible for it.

“The IRS continues to work hard to improve and help taxpayers,” IRS Commissioner Danny Werfel said in a statement. “These payments are an example of our commitment to go above and beyond for taxpayers.”

“Looking at our internal data, we realized that one million taxpayers were skipping out on claiming this complex credit when they were actually eligible,” Werfel said. “To minimize headaches and get that money to eligible taxpayers, we’re making these payments automatic, meaning those people won’t have to go through the lengthy process of filing an amended return to receive it.”

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The IRS is sending recapture rebate credit payments to eligible taxpayers this month. ((Photo by Spencer Platt/Getty Images)/Getty Images)

Most taxpayers who were eligible for the catch-up refund credit or one or more stimulus payments (EIPs), also known as stimulus payments, have already received those credits and payments. Credit and stimulus payments were created in response to the covid-19 pandemic.

The special payments announced by the IRS are for qualified taxpayers who filed a 2021 tax return with the data field for Recovery discount credit left blank or filled in as $0 when the taxpayer was, in fact, eligible for the credit.

Taxpayers who did not claim the credit, or a portion of it, on their 2021 tax return are expected to receive payments from the IRS by the end of January 2025. The payment will be sent to the account bank account listed on the taxpayer’s 2023 tax return. or to your registered address.

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Internal Revenue Service Commissioner Daniel Werfel said the agency found that about a million taxpayers who were eligible for the rebate did not claim it on their 2021 tax returns. ((Tom Williams/CQ-Roll Call, Inc via Getty Images)/Getty Images)

The catch-up refund credit amounts that must be paid are variable based on a number of factors, although the maximum payment is $1,400 per individual. The IRS estimates that the total amount of payments to be distributed is approximately $2.4 billion.

The IRS will include a letter to taxpayers receiving the 2021 recapture rebate credit payment. If a taxpayer has closed the bank account associated with their 2023 tax return since filing, taxpayers do not have to take no action, as the bank will return the payment to the IRS, which will reissue the refund to the taxpayer’s address of record.

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There is also a deadline in the first half of 2025 for taxpayers who have not filed their 2021 tax returns, as they must file by April 15, 2025, to still receive a credit of recovery reimbursement for which they are eligible. .