As of late, the IRS has been sending out letters with valuable information for Advance Child Tax Credit and for the third round of the Economic Impact payments to those who qualify. Letters will be going out until the end of January. Keeping this information and using it to prepare your tax return will help to reduce errors and delays in processing.
For those who will be receiving these letters, the IRS urges you to hold on to these letters to help you prepare your 2021 federal tax returns.
The following information will help taxpayers coordinate and receive the Child Tax Credits, they are entitled to. As of late December through January, the Internal Revenue Service will send out the 6419 Letter for the advanced CTC. This letter covers the amount of advance Child Tax Credit payments made in 2021 and the amount of qualifying children used to calculate their advance payments. Taxpayers should keep this letter as well as all letters from the IRS along with their tax records regarding advance Child Tax Credit payments.
Taxpayers who have received advance payments will have to file a 2021 tax return and check the Child Tax Credit payment they were given in 2021 along with the credit they were allowed on their 2021 tax return
If taxpayers did not get advance Child Tax Credit, they may claim the full amount of the Child Tax Credit on 2021 tax return filed in 2022. This includes families who normally do not file tax returns.
Toward the end of January, the Internal Revenue Service will be sending out the 6475 Letter for the third Economic Impact Payment to EIP beneficiaries. The letter will help recipients decide if they are entitled to and should claim the Recovery Rebate Credit on their 2021 tax return which they will file in 2022.
For the 3rd round of Economic Impact Payments issued in March of 2021, the 6475 Letter has been sent out. The third round of Economic Impact Payments included the “plus-up” payments, which were advance payments of the 2021 Recovery Rebate Credit that would be claimed on the 2021 tax return.
The IRS sent out the plus-up payments to beneficiaries who were given the third Economic Impact Payment. This payment is provided from information provided by VA, SSA, and RRB. This also applies to people who might be eligible for a larger amount based on their 2020 tax return. The plus-up payments were additional payments the IRS sent to those who received a third Economic Impact Payment based on their 2019 tax return.
Most people who are eligible, have already received their payments. Those who are missing stimulus payments should review the information to find out their eligibility and if they need to claim a Recovery Rebate Credit for the tax year 2021.
The Economic Impact Payment letters are like the advance CTC letter. It includes important information that will help taxpayers accurately and quickly file their tax returns.