ATLANTA — The IRS has been quite generous in 2021, and some taxpayers have been caught off guard by all the checks arriving in their mailbox.
There have been stimulus checks and advanced child tax payments. Then there are the provisions of the American Rescue plan that have not been as highly publicized, resulting in the unusual amount of generosity from the I.R.S.
“They’re good about issuing a few refund checks, but now there’s hundreds of billions of dollars flowing out,” said Lance Palmer, a Professor in UGA’s College of Family and Consumer Sciences.
Over 23 million American workers filed for unemployment last year. Their unemployment checks were taxed by the IRS.
The American Rescue Plan changed how much the IRS can have. So, about 13 million Americans are getting refunds.
Dr. Patrick Washington, a Professor of Finance at Morehouse College, said some will be surprised by payments that arrive long after their unemployment ended.
“They’ve been sending out checks to filers who had really simple IRS filings first,” said Dr. Washington. “So, the more complicated your filing the longer it’s going to take.”
The IRS is overwhelmed with added duties as a result of the pandemic.
Part of that involves changes in the Advance Premium Tax Credit that gives breaks to many Americans getting their insurance through the Federal Marketplace. The American Rescue Plan expanded the number of Americans who qualify for the tax credit. Palmer said the result for some is a check in the mailbox.
“They may have paid back some of their premium tax credit when they filed their return, and now they’re going to get a refund on that," he said.
The IRS says most taxpayers who qualify for a check don’t need to do anything except wait and be patient.