30 million people may now get their $1,400 stimulus checks after the Social Security Administration released new information

Richard Neal
Rep. Richard Neal (D-MA).

  • 30 million people on Social Security and Supplemental Security incomes haven’t gotten stimulus checks yet.
  • That’s because the SSA wasn’t sending necessary payment information to the IRS.
  • Top House Democrats gave the SSA 24 hours to provide it, and the IRS got it Thursday morning.
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Following a 24-hour ultimatum from Democratic lawmakers, the Social Security Administration provided information to the Internal Revenue Service on Thursday that will help more Americans get stimulus payments.

Nearly 30 million Social Security and Supplemental Security income beneficiaries were kept waiting on stimulus payments because, House Democrats said, the SSA hadn’t provided the Internal Revenue Service with necessary payment files for them.

On Wednesday, the chair of the House Ways and Means Committee, Richard Neal, and the chair of the House Oversight Subcommittee, Bill Pascrell, Jr., sent a letter to the SSA requesting that information be sent over right away. “We are giving the trump-appointed heads of the Social Security Admin **24 Hours** to get off their backsides and stop delaying sending stimulus checks to 30,000,000 Americans,” Pascrell said on Twitter on Wednesday.

On Thursday, the SSA transferred the necessary files to the IRS, making it possible for the affected Americans to get the $1,400 stimulus checks that many others have already received.

“The delays imposed by Commissioner Saul defied congressional intent and imposed needless anxiety and pain on taxpayers,” the Democrats said in a statement on Thursday. “Now the IRS needs to do its job and get these overdue payments out to suffering Americans. Further delays will not be tolerated by this committee.”

Rep. John Larson of Connecticut and Rep. Danny Davis of Illinois had joined Neal and Pascrell in calling for action from the SSA and IRS.

Since President Joe Biden’s stimulus bill was signed into law, Americans across the country have encountered delays in receiving stimulus aid. Due to December and March stimulus changes, the IRS was behind in processing nearly 7 million tax returns, and customers of major online tax preparers, such as TurboTax and H&R Block, faced delays on the $10,200 tax break on unemployment benefits received during the pandemic.

As a result of the delays, along with calls from lawmakers, the IRS extended tax filing season to May 17, which Neal and Pascrell said would lift the “titanic strain” on taxpayers.

The Treasury Department, IRS, and Bureau of Fiscal Service announced on Wednesday that 127 million of the $1,400 stimulus checks have been sent out to date.

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Nearly 7 million tax returns haven’t been processed by the IRS because of stimulus changes

IRS office
Internal Revenue Service.

  • The IRS is behind in processing tax returns for nearly 7 million Americans.
  • Changes in the December and March stimulus bills account for the delay, as does a cut in IRS staffing.
  • Lawmakers have asked the IRS to extend deadlines and remove requirements on filing amended returns.
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President Joe Biden signed his $1.9 trillion stimulus package on Thursday, a win for many Americans who needed financial aid to recover from the pandemic. But that has slowed things down for the Internal Revenue Service to the extent that 7 million Americans are now waiting for tax refunds.

In December, Congress passed a $900 billion stimulus package that included $600 stimulus checks the IRS had to distribute. The more recent passage of the American Rescue Plan requires the agency to begin distributing $1,400 stimulus checks, and to field adjustments to unemployment benefits – a tax exemption on the first $10,200 of benefits – as well as a new child tax credit.

According to IRS data, 6.7 million tax returns have not yet been processed in 2021, but in 2020, only around 2 million returns faced processing delays, reflecting the effects of the stimulus changes.

IRS spokesman Robert Marvin told The Washington Post on Friday that while most refunds take 21 days to be issued after filing season starts, some refunds may take longer.

“Many factors can affect the timing of your refund after we receive your return,” Marvin said. “Some tax returns take longer to process than others. For example, returns with an error, incomplete information or those affected by theft or fraud may take longer to process.”

In addition, the Government Accountability Office found in a March 1 report that from 2010 to 2019, IRS staffing was down by almost 23% and its budget was cut by 20%, factoring into the processing delays that must be resolved manually.

“IRS’s overall 2020 performance was significantly impacted by its reliance on manual processes such as for paper returns, and its limited ability to process returns remotely while processing centers were closed,” the report said. “As a result, as of December 2020, IRS had a significant backlog of unprocessed returns and taxpayer correspondence.”

Democratic lawmakers have expressed concern with the backlog the IRS is experiencing, and the effects the backlog has on taxpayers who need their refunds to stay financially afloat. House Ways and Means Committee Chair Richard Neal and House Oversight Subcommittee Chair Bill Pascrell called for the IRS to extend tax filing season on March 8, citing the lack of help taxpayers were receiving from the agency.

More recently, 21 Democrats, led by Senate Majority Whip Dick Durbin, called on Friday for the IRS to remove the current requirement of an amended tax return for taxpayers who have already filed and want to account for tax relief in the stimulus bill.

“We recognize the challenges of implementing this change in tax law during filing season, particularly as millions of Americans have already filed their tax returns for 2020,” the letter said. “This underscores the need for Treasury and the IRS to take every action to ensure that all eligible individuals, including those who have already filed their 2020 tax return, are aware of and able to receive this critical relief.”

Biden’s stimulus plan included $1.9 billion in additional funding for the IRS, but the agency has yet to respond to lawmakers’ concerns on processing delays.

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2 key House Democrats want the IRS to extend tax filing season, citing ‘titanic strain’ on taxpayers

Richard Neal
Rep. Richard Neal (D-MA).

  • Two House Democrats called on the IRS to extend the tax filing season past April 15.
  • The extension would allow taxpayers time to accurately file returns and factor in tax changes in the stimulus.
  • Accountants also support an extension to account for prior tax return processing delays from the IRS.
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To continue providing economic relief to Americans during COVID-19, two House Democrats called on the Internal Revenue Service on Monday to extend the the 2021 tax filing season past April 15.

Ways and Means Committee Chair Richard Neal and Oversight Subcommittee Chair Bill Pascrell, Jr. said in a joint statement that at the end of February, the number of returns filed was down nearly 25% year-over-year, while only 27% of phone calls to the IRS were answered, indicating that a majority of taxpayers weren’t getting the help they needed in filing taxes.

“We want to remind the IRS that many Americans continue to face the same health and economic challenges that necessitated an extension last year,” Neal and Pascrell said. “Facing enormous strain and anxiety, taxpayers need flexibility now. We demand that the IRS announce an extension as soon as possible.”

Last year, the IRS extended the tax filing season to July 15 – three months later than the usual April filing – and extending it again this year will allow time to account for changed laws within President Joe Biden’s American Rescue Plan, according to the statement. This includes unemployment benefits, with the first $10,200 of benefits set to be eliminated from taxation in 2020.

Accountants are also worried about the quickly approaching tax season deadline. In a March 4 letter, American Institute of Certified Public Accountants Chair Christopher W. Hesse, on behalf of the organization with more than 431,000 members, requested that the IRS extend the tax filing season to June 15.

“Maintaining the April 15 filing and payment deadline does not reflect the real-world hardship and challenges imposed on taxpayers and tax professionals,” Hesse wrote. “Therefore, we urgently request that the 2020 Federal income tax, information returns, and payments (e.g., extension and estimated payments) originally due April 15, 2021 be granted additional time to file and pay until June 15, 2021.”

In defense of the extension, Hesse cited circumstances reflecting its need, including:

  • A delay to the start of the 2020 tax filing season;
  • The second round of the Paycheck Protection Program required significant assistance to small business clients, and tax professionals are still assisting clients with the PPP’s first round loan forgiveness process;
  • The IRS’ delayed processing of 2019 tax returns;
  • And effects on staffing in the IRS due to the pandemic, which has made it difficult to respond to taxpayers’ questions.

Hesse also noted that there is still confusion regarding eligibility of the $1,400 stimulus checks, and whether they are taxable.

The Ways and Means Committee said on Twitter on Monday that the April 15 tax filing deadline does not give taxpayers the time they need to file appropriately.

“Taxpayers are facing enormous economic strain and anxiety this filing season,” the Committee said. “They need more time to get their questions answered and file accurate returns.”

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