IRS warning millions of low earners they're missing out on Covid-era payments

Millions of low-income Americans appear not to have realized they can get potentially massive payments this year from the IRS thanks to a bevy of temporary tax provisions Congress approved in the wake of the coronavirus pandemic.

The agency said Thursday that it intends to send letters to nine million people and families who appear to qualify for all or part of the breaks but didn’t claim them.

The department is reminding them they don’t necessarily have to have earnings to take advantage and that it’s okay that they missed the April filing deadline, but that they need to file a return in order to benefit.

“We don’t want people to overlook these tax credits, and the letters will remind people of their potential eligibility and steps they can take,” said IRS Commissioner Charles Rettig in a statement.

People can potentially get five-figure payments if they haven’t claimed last year’s expanded child credit, worth as much as $3,600 per child; stimulus payments of $1,400 per person; an expanded child and dependent care credit of up to $8,000; as well as a boosted Earned Income Tax Credit.

Advocates for low-income people have been trying to get the word out, though people with little or no income can be difficult to reach. Many aren’t used to dealing with the tax system because they earn so little they are exempt from filing requirements, and may be intimidated by the prospect of filing a return.

The Biden administration was forced to suspend a special tool for non-filers during tax season because of technical issues, and the total amount of money available was sometimes overshadowed by political fights in Congress over the fate of Democrats’ expansion of the child credit.