The IRS said Monday it has recently issued hundreds of thousands more COVID-19-related relief refunds to the tune of more than a half-billion dollars. These were the latest round of refunds made possible by the American Rescue Plan signed in March.
Most Americans think of two things that came out of the relief bill. One is the $1,400 stimulus checks to most Americans. The other is the monthly advance child tax credit.
But the bill also forgave taxes on the first $10,200 in unemployment funds taxpayers received in 2020. It applied to individuals and married couples whose income was less than $150,000. While the exclusion was counted for most people who filed their taxes after the bill passed, millions had already sent in their 2020 taxes beforehand. The IRS had to calculate how much that latter group of people would get back.
The agency started with the simplest returns, with the first payments having gone out in May, and worked its way back to the more complicated ones. This latest round of 430,000 refunds, announced Monday, was for $510 million. The IRS said the average refund was $1,189.
A total of 11.7 million refunds for $14.4 billion has been issued, the agency said.
The IRS plans to send out another batch before the end of the year. Taxpayers who are due a refund typically will get a letter from the IRS within 30 days of the adjustment, the agency said, and if the money would come in the form of a refund or would be applied to any outstanding IRS debt.
The agency said it is looking to correct Earned Income Tax Credit, Additional Child Tax Credit, American Opportunity Credit, Premium Tax Credit and Recovery Rebate Credit amounts that may have been affected by the unemployment exclusion.