The government is issuing another series of refunds this week to taxpayers who received unemployment benefits and paid too much taxes over the past year, the Internal Revenue Service said.
The agency said it is issuing 1.5 million tax refunds to Americans this week, with the typical refund being around $ 1,600. The IRS said direct deposit payments went out as of July 28 and paper checks entered mailboxes on July 30.
This is the fourth round of unemployment benefits reimbursements the IRS has issued since Congress changed the tax law this spring to allow former unemployed people to retain more of their benefits. The IRS has three previous rounds of Payments in May, June and earlier this month.
Usually, unemployment benefits are subject to federal income tax. However, the American rescue plan passed in March had up to $ 10,200 in unemployment benefits would not be taxable. The change, passed after millions of unemployment benefit recipients had already filed tax returns, meant that many refunds were due.
The IRS said beforehand up to 13 million people could be eligible for a refund. Since May, the agency has returned $ 10 billion to 8.7 million taxpayers, it said. The IRS plans to further review and adjust tax returns this summer.
How do you get a refund?
Most taxpayers who may have overpaid their taxes don’t need to do anything to get a refund, according to the IRS. The agency said it is proactively adjusting taxpayers’ refunds and sending money back.
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However, a group of people may need to file an amended tax return in order to receive all of the money they are due. If a taxpayer has a loved one and their income, excluding unemployment benefits from last year’s total income, falls below the income tax credit limits, they must file an amended declaration to claim that tax credit, the IRS said.
This doesn’t apply to individual taxpayers who are eligible for the EITC – the IRS will automatically adjust their tax returns, the agency said.
The maximum income to apply for the EITC is approximately $ 41,000 for a single parent of a child and $ 47,000 for a married couple. The limits increase with more children.