IRS to adjust stimulus payment errors for eligible individuals

Some individuals who did not receive their economic impact payment – or received less than they were eligible for – may not have to wait until next year to see the amount corrected.

The Taxpayer Advocate Service will help the IRS resolve stimulus check issues beginning on August 10 – and the IRS will start correcting payment amounts for eligible Americans within the coming weeks.

Individuals who are due an additional amount of money will receive it in the same form as their initial economic impact payment – unless it was on a debit card, in which case the individual will receive a paper check instead.

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Some people, however, will still have to wait until they file their 2021 return in order to receive the correct amount. Specific guidance to help people determine whether they can take action now, or will need to wait until next year, can be expected soon – along with details regarding how to reach out for assistance.

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In the meantime, here’s a look at some of the scenarios where individuals and families may have their economic impact payment amounts corrected this year, according to the Taxpayer Advocate:

• People who used the IRS’ nonfiler tool and claimed at least one qualifying child but did not receive the qualifying child portion of the payment. These individuals can expect supplemental cash within the coming weeks.
• Eligible individuals who filed Form 8379, Injured Spouse Allocation did not receive their payment. The injured spouse’s portion of the money can be also expected in the coming weeks.
• Individuals whose check was based on a 2018 or 2019 tax return where the IRS adjusted the return for a math error that negatively impacted the original amount of the EIP (e.g., Qualifying Child, Adjusted Gross Income, filing status). The IRS can work with the taxpayer to resolve the math error and, if appropriate, issue a payment for the additional amount.
• Victims of identity theft who did not receive a payment, or received an incorrect amount, will be sent the correct amount when the identity theft issue is resolved.
• People who did not receive a check because they filed a joint return with a deceased or incarcerated spouse. The IRS will recalculate the amount and issue it to the nondeceased/non-incarcerated spouse.

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Meanwhile, lawmakers are currently debating the terms of another stimulus package, which could include an additional direct payment. Both Republicans and Democrats have broadly proposed giving households another round of $1,200 checks.

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