Important mail about economic impact payment is arriving soon

covid fiscal advice 2022-03, January 5, 2022

The IRS began issuing information letters to advance recipients of child tax credits in December. Recipients of the third round of Economic Impact Payments will begin receiving information letters in late January. Using the information from these letters when preparing a tax return can reduce errors and processing delays.

People who receive these letters should keep them. don’t throw them away. these letters can help taxpayers or their tax professional prepare their 2021 federal income tax return.

child tax credit advance payment letter can help people get the rest of the 2021 credit

To help taxpayers reconcile and receive all of the 2021 child tax credits to which they are entitled, the IRS began sending letter 6419, 2021 advance ctc, in late December 2021 and will continue through January. This letter includes the total amount of child tax credit advance payments taxpayers received in 2021 and the number of qualifying children used to calculate the advance payments. Individuals should keep this and any other letters from the IRS about advance payments of the child tax credit with their tax records.

Families who received advance payments should file a 2021 tax return and compare the advance payments they received in 2021 to the amount of child tax credit they can correctly claim on their 2021 tax return.

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The letter contains important information that can make preparing your tax returns easier. Individuals who received payments in advance can also check the amount of their payments using the CTC Update Portal available on irs.gov.

Eligible families who did not receive any advance payment of the child tax credit can claim the full amount of the child tax credit on their 2021 federal income tax return. This includes families who do not normally need to file a tax return.

the economic impact payment letter can help people claim the 2021 recovery rebate credit

The IRS will begin issuing Letter 6475, its third Economic Impact Payment, to EIP recipients in late January. This letter will help Economic Impact Payment recipients determine if they are eligible and should claim the Recovery Refund Credit on their 2021 tax returns when they file in 2022.

letter 6475 only applies to the third round of Economic Impact Payments, which were issued between March and December 2021. the third round of Economic Impact Payments, including the “additional” payments, were advance payments of the refund 2021 recovery credit that would be claimed on a 2021 tax return. Additional payments were additional payments the IRS sent to individuals who received a third Economic Impact Payment based on a 2019 tax return or information received from the IRS. Social Security Administration, Railroad Retirement Board, or Veterans Affairs. Additional payments were also sent to people who were eligible for a higher amount based on their 2020 tax return.

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Most eligible people have already received payments. However, people who are missing stimulus payments should review the information on irs.gov to determine their eligibility and whether they need to claim a recovery refund credit for 2020 or 2021. This includes people who do not normally need to file a tax return.

Economic Impact Payment letters include important information that can help people file their taxes quickly and accurately.

More information about the 2021 Advance Child Tax Credit, Economic Impact Payments, and other COVID-19-related tax relief is available at irs.gov.

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