IRS Planning to Send Letters in the Mail
In December, the IRS began issuing letters in the mail to all recipients of advance child tax credits given in 2021. Additional informational letters documenting the third round of Economic Impact Payments will be sent during January 2022.
These letters are purely informational in nature and should be kept to ensure that the proper amounts are recorded in your 2021 tax return. If you receive these letters, it is important to save them for recordkeeping purposes. They can assist you or your tax preparer when it comes time to complete your return.
If the amounts input on your tax return vary from those indicated in your informational letters, it can delay the processing of your tax return for up to 12 months. Thus, it’s important to compare the two and make sure they are the same.
What to Know About the Advance Child Tax Credit Letter
Letter 6419, 2021 advance CTC began to be sent to eligible families in late December 2021. This letter outlines the child tax credit payment advance that was sent during the year, along with the number of children used to calculate the total payment.
Families who received advance child tax credit payments in 2021 will need to fill out a 2021 tax return and compare the amount of the child tax credit that they should have been eligible for with what they received. If the amount differs, they may need to refund the IRS some of the credit amount, or they may be eligible for an additional refund.
If your family is eligible for the child tax credit but did not receive any advance payments, you may claim the full amount of the credit available to you.
What to Know About the 2021 Recovery Rebate Credit Letter
The IRS will begin issuing Letter 6475, Your Third Economic Impact Payment, to recipients in late January. This letter indicates the amount of recovery rebate credit in 2021 that was sent to eligible recipients. It applies only to payments that were sent from the period of March 2021 to December 2021.
While most payments were sent in the spring of 2021, an additional number of plus-ups were sent to those individuals who were found eligible based on information from their 2019 or 2020 tax returns.
If you did not receive a recovery rebate payment and were eligible for one, you can claim the credit on your 2021 tax return. However, you should carefully review your informational letter to make sure that you are not mistakenly claiming the rebate if you have already received it.
A tax preparer can review your informational letter and your 2021 tax return to ensure that you receive any proper credit due.
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