One million taxpayers will soon receive up to $1,400 from the IRS. Who are they and why now?

About 1 million taxpayers will automatically receive special payments of up to $1,400 from the IRS in the coming weeks. Funds will be deposited directly into eligible individuals’ bank accounts or mailed with a paper check.

The IRS said it is distributing nearly $2.4 billion to taxpayers who failed to claim the Discount Refund Credit on their 2021 tax returns. People who missed the renewal payments due to COVID or received less than the full amount were able to apply for the credit. But the IRS on Friday said it found many eligible taxpayers did not.

“When we looked at our internal data, we realized that millions of taxpayers neglected to claim this complex credit when they were eligible,” IRS Commissioner Danny Werfel said in a statement.

Here’s more on the windfall this group of taxpayers will soon receive:

What are the chances of me getting a check?

Sorry, it’s probably too low. The IRS said most taxpayers eligible for federal stimulus payments, officially known as Economic Impact Payments, have already received them.

Special payments announced by the IRS are being sent to those taxpayers who filed their 2021 tax return but left the Acquisition Discount Credit data field blank or filled it in as $0 when they were actually eligible for the credit.

How will this work?

Eligible taxpayers do not need to take any action. Payments will go out automatically this month and should arrive by direct deposit or check by late January 2025. They will be sent to the bank account listed on the taxpayer’s 2023 return or to the address the IRS has on file.

Fees will vary but the maximum amount will be $1,400 per person. The IRS has posted information online about eligibility and how the payment is calculated.

The IRS plans to send separate letters to eligible taxpayers notifying them of the special payment.

What if I haven’t filed my 2021 tax return yet?

You can still accept money. However, taxpayers need to file a tax return and claim the Acquisition Discount Credit no later than April 15, 2025, even if any income from a job, business or other source was little or no, according to the IRS.

How many rounds of COVID renewal payments have there been?

There have been three rounds of payments to households affected by the epidemic, totaling $814 billion. The IRS is based on the amounts the taxpayers received from their income, tax filing status and the number of children or eligible dependents.

As of March 2020, eligible individuals receive up to $1,200 per tax filer and $500 per child under the CARES Act. In December 2020, eligible individuals receive up to $600 per tax filer and $600 per child under the Consolidated Spending Act. Through March 2021, eligible individuals receive up to $1,400 per tax filer and $1,400 per child under the American Rescue Plan law.