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Money Management

Did You Just Get a Check from the IRS? Here’s Why

Nothing brightens up a morning like surprise money.

The other day, I logged onto my bank account to check the standings of my funds and guilt myself over my credit card bill. Fairly typical practices, but when I checked my checking account, I was surprised to see a fresh deposit from the IRS! I was obviously confused; I don’t have any kids, so it couldn’t have been the child tax credit, and as far as I know, nobody’s agreed to send out any new stimulus checks, so where did this money come from? As it turns out, I missed a headline earlier this week, and according to reports, so did a lot of people.

Earlier in the week, the IRS announced that it would be issuing a new round of refunds to the American public as part of the American Rescue Plan passed back in March. See, part of the documentation of the American Rescue Plan included a big wad of money to serve as compensation for unemployment taxes. A lot of people filed their taxes this year in February, before the American Rescue Plan was passed, and as such, their refund balance shifted slightly. This is why you may have received a direct deposit payment from the IRS this week; it’s a refund for unemployment tax alterations to properly reflect what you paid in your return and the American Rescue Plan.

According to the IRS’ statistics, approximately 4 million Americans are eligible for a refund, though the exact scope of the refund you receive will depend on how much unemployment assistance you sought last year, as well as your income bracket. These refunds are only for individuals or married couples with a gross annual income of less than $150,000. If you don’t have your direct deposit info on file with the IRS, you should receive a paper check in the mail within a month or so.

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