IRS disbursing $2.04 billion in unpaid stimulus funds- Are You Eligible?

IRS disbursing $2.04 billion in unpaid stimulus funds: Still waiting on your third stimulus check? You might be in luck—but you’ll need to act fast. The IRS is releasing $2.4 billion in Recovery Rebate Credit payments to nearly 1 million Americans who missed out in 2021. If you never received the third Economic Impact Payment, you could still claim up to $1,400 per person—but only if you file or amend your 2021 tax return before April 15, 2025.

This guide breaks down everything you need to know about the stimulus payments, eligibility rules, how to file, and common mistakes to avoid.

What’s Happening?

The Internal Revenue Service (IRS) has launched an initiative to get financial relief to those who never received the third stimulus check during the COVID-19 pandemic. These payments are part of the 2021 Recovery Rebate Credit (RRC), and they’re going out now—but only to those who are eligible and take the necessary steps.

• Total Funds Available: $2.4 billion
• People Affected: ~1 million
• Max Payment: $1,400 per eligible individual
• Deadline to File: April 15, 2025
• Distribution Method: Direct deposit or paper check

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What Is the Recovery Rebate Credit?

The Recovery Rebate Credit was designed to help people who didn’t receive full stimulus payments (also known as Economic Impact Payments) in 2020 and 2021. The third stimulus check, issued in 2021, was worth up to $1,400 for each adult and dependent.

While many Americans got this payment automatically, the IRS found about 1 million eligible people who didn’t claim it on their 2021 tax returns—and they may not even know they’re missing out.Real Example: Why This Matters

Let’s say Amanda, a single mom of two, didn’t earn income in 2021 and assumed she didn’t need to file a tax return. She unknowingly missed out on $4,200 in stimulus funds. Now, thanks to the IRS review, Amanda still has a chance to get the money—but only if she files a 2021 return before the deadline.

Who Qualifies for IRS Recovery Rebate Credit 2025?

You might be qualify for the Recovery Rebate Credit if:

• You were a U.S. citizen or resident alien in 2021.
• You filed a 2021 tax return and did not receive or claim the RRC.
• Your Adjusted Gross Income (AGI) in 2021 was:
  • $75,000 or less (single filer)
  • $112,500 or less (head of household)
  • $150,000 or less (married filing jointly)
• You were not claimed as a dependent by someone else.

Even if you had no income in 2021, you may still qualify.

When & How Will You Get Paid?

Payment Timeline:

• The IRS began issuing payments in December 2024.
• Most payments are being sent via direct deposit or mailed checks by January 2025.

Delivery Methods:

• If your bank account on file is active, the IRS will send a direct deposit.
• If not, a paper check will be mailed to your last known address.
• The IRS will also send an official letter confirming your payment.

Haven’t Filed Yet? Here’s What to Do

If you didn’t file a 2021 return, it’s not too late. But you must file or amend your return by April 15, 2025.

Steps to Claim Your IRS Recovery Rebate Credit:

1. Check Your Tax Account:
   • Log in to your IRS Online Account to see if you received or claimed the Recovery Rebate Credit.
2. Amend or File a Return:
   • If you didn’t claim it, use Form 1040-X to amend your 2021 return.
   • New filers can use Form 1040 to file a 2021 return.
3. Choose Your Filing Method:
   • Use reputable tax software (TurboTax, H&R Block) or the IRS Free File service.
   • You can also file a paper return if you prefer.
4. Track Your Refund:
   • Use the “Where’s My Refund?” tool or the IRS2Go app for real-time updates.

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Common Mistakes to Avoid

• Thinking You’re Ineligible: Even with $0 income in 2021, you could qualify.
• Missing the Deadline: April 15, 2025, is your last chance to file or amend.
• Using the Wrong Year: This credit is only for the 2021 tax year.
• Forgetting Dependents: Each eligible dependent can add $1,400 to your total.

Should You Hire a Tax Pro?

If you’re unsure how to proceed, working with a tax professional, such as a CPA or enrolled agent, may be worth it—especially if:

Final Thoughts

This is a rare second chance to claim pandemic-related financial relief that many missed. If you’re one of the estimated 1 million Americans who didn’t receive the third stimulus payment, don’t wait. File or amend your 2021 tax return before April 15, 2025—and get the money you’re owed.

Frequently Asked Questions (FAQs)