Economy
Why Some Stimulus Check Recipients Should Consider Filing Amended Returns
Published:
With the tax filing deadline just around the corner, the IRS has come up with an important message for early filers. According to the IRS, some state stimulus check recipients should consider filing amended returns. This announcement from the agency relates to the IRS’ recent decision to not tax special payments from the states.
Why Stimulus Check Recipients Should Consider Filing Amended Returns
There was a lot of confusion among taxpayers this year regarding the special payments (inflation relief checks, tax rebates or stimulus checks) that they got from their state last year. The confusion was regarding the taxability of these payments.
Initially, the IRS asked taxpayers to hold off on filing tax returns until it made a decision on the matter. In time, the agency determined that many of those state payments were not taxable.
However, by the time the IRS came out with its decision (on Feb 10), many people had already filed their tax returns. Some of these early filers would have reported the special payments as taxable income, and thus, are now eligible for a refund.
Such stimulus check recipients should consider filing amended returns. In its decision, the agency “provided details clarifying the federal tax status involving special payments made to taxpayers by 21 states in 2022.”
The IRS is asking taxpayers who filed their return before Feb 10 to check the guidelines and ensure their return is in line with those guidelines. In case they already paid taxes on the special payments, but aren’t required to, then such stimulus check recipients should consider filing amended returns as they could be eligible for a refund.
“….taxpayers who filed their federal income taxes early in this year’s filing season and reported certain state 2022 tax refunds as taxable income should consider filing an amended return,” the IRS said in a press release.
How To File An Amended Return
If taxpayers determine that they need to file an amended return, then those who filed their original 2022 tax return electronically can file their amended return electronically. Such taxpayers can also select the direct deposit option to get a refund.
“Filing electronically cuts out the mail time and including direct deposit information on an electronically submitted form provides a convenient and secure way to receive refunds faster,” the IRS says.
Taxpayers can also submit a paper version of the amended return. For this, they need to file Form 1040-X, Amended U.S Individual Income Tax Return, and mail it to: Department of the Treasury, Internal Revenue Service, Austin, TX 73301-0052.
Taxpayers who file their amended return on paper don’t have the option to get the refund via direct deposit, i.e., they will receive a paper check only.
Irrespective of how taxpayers file their amended returns, they can use the online tool – Where’s My Amended Return? – to check the status of their refund.
This article originally appeared on ValueWalk
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