The Internal Revenue Service (IRS) has announced that individuals who did not file their taxes for the year 2020 have until May 17 to do so. If they miss this deadline, any potential refund they might have received will be permanently forfeited. But, what about new stimulus checks? We´ll cover it now.
Tax returns for 2020
The IRS reports that the median tax refund amount for the 2020 tax year was $932. However, this amount varied significantly by state, with Idaho’s median refund at $761 and Pennsylvania’s reaching up to $1,031. The IRS has provided a detailed breakdown of how much money is owed to residents in each state on its website.
Americans who have not yet filed for their 2020 tax return can still claim their share of the $1 billion in unclaimed funds. To be eligible for a refund, a return must be filed within three years of its original due date. This means that taxpayers have a limited window to ensure they do not miss out on any refunds owed to them.
Additionally, the IRS urges taxpayers to file electronically and opt for direct deposit to expedite the refund process. For those needing assistance, the IRS offers various resources, including free filing services for those who qualify. It’s important to act promptly to avoid losing out on these funds permanently.
Qualifying Americans can receive the maximum amount under the latest round of stimulus payments, provided their income is $75,000 or below for individuals, or $150,000 for couples. Beyond these income thresholds, the $1,400 stimulus check begins to phase out and is completely phased out at $80,000 for individuals and $160,000 for couples.
Requirments for stimulus checks
These income requirements are similar to those in the previous two rounds of stimulus payments, although the phase-out rules differ slightly. For instance, in earlier rounds, individuals were ineligible for stimulus payments if their income exceeded $86,999, or $173,999 for married couples.
To ensure you receive the full amount, it’s important to understand how your adjusted gross income (AGI) affects eligibility. The AGI is calculated based on your total income minus specific deductions, and it’s a crucial factor in determining the stimulus amount you qualify for.
If you’re close to the income thresholds, contributing to a retirement account or making other adjustments to reduce your AGI could potentially increase your stimulus payment. Additionally, those who had significant changes in their financial situation during the tax year—such as a job loss or reduction in income—should ensure these changes are accurately reflected in their tax return.