The Internal Revenue Service today encouraged taxpayers to take important actions this month to help them file their federal tax returns in 2022, including special steps related to Economic Impact Payments and advance Child Tax Credit payments.
This is the second in a series of reminders to help taxpayers get ready for the upcoming tax filing season. Aspecial page, updated and available on IRS.gov, outlines steps taxpayers can take now to make tax filing easier in 2022.
Here are some key items for taxpayers to consider before they file next year.
Check on advance Child Tax Credit payments
Families who received advance payments will need to compare theadvance Child Tax Credit paymentsthat they received in 2021 with the amount of the Child Tax Credit that they can properly claim on their 2021 tax return.
Taxpayers who received less than the amount for which they’re eligible will claim a credit for the remaining amount of Child Tax Credit on their 2021 tax return. Taxpayers who received more than the amount for which they’re eligible may need to repay some or all of the excess payment when they file.
In January 2022, the IRS will send Letter 6419 with the total amount of advance Child Tax Credit payments taxpayers received in 2021. People should keep this and any other IRS letters about advance Child Tax Credit payments with their tax records.
SeeReconciling Your Advance Child Tax Credit Payments on Your 2021 Tax Returnfor more information.
Eligible families who did not get monthly advance payments in 2021 can still get a lump-sum payment by claiming the Child Tax Credit when they file a 2021 federal income tax return next year. This includes families who don’t normally need to file a return.
Economic Impact Payments and claiming the Recovery Rebate Credit
Individuals who didn’t qualify for the thirdEconomic Impact Paymentor did not receive the full amount may be eligible for theRecovery Rebate Creditbased on their 2021 tax information. They’ll need to file a 2021 tax return, even if they don’t usually file, to claim the credit.
Individuals will also need the amount of their third Economic Impact Payment and any Plus-Up Payments received to calculate their correct 2021 Recovery Rebate Credit amount when they file their tax return. Ensuring they use the correct payment amounts will help them avoid a processing delay that may slow their refund.
In early 2022, the IRS will send Letter 6475 that contains the total amount of thethird Economic Impact Payment and any Plus-Up Paymentsreceived. People should keep this and any other IRS letters about their stimulus payments with other tax records. Individuals can also log in to theirIRS.gov Online Accountto securely access their Economic Impact Payment amounts.
SeeIRS.gov/rrcfor more information.
Charitable deduction changes
Taxpayers who don’t itemize deductions may qualify to take a charitable deduction of up to $600 for married taxpayers filing joint returns and up to $300 for all other filers for cash contributions made in 2021 toqualifying organizations. For more information, readPublication 526, Charitable Contributions.
Get banked to get ready to direct deposit
Direct depositgives taxpayers access to their refund faster than a paper check. Those without a bank account can learn how to open an account at anFDIC-insured bankor through theNational Credit Union Locator Tool. Veterans should see theVeterans Benefits Banking Programfor access to financial services at participating banks.
