Many people in the United States have seen payments showing up in their bank accounts as the Internal Revenue Service (IRS) has been distributing different types of payments to taxpayers. The Taxpayer Advocate Service (TAS) decided to release a guideline, so people will know if it’s a tax refund or a tax credit.
The IRS sends out hard-copy notices to taxpayers regarding the money that they received. However, because the money is credited way before the taxpayer gets the documents, they are puzzled about the money that ended up in their bank account, Fast Company reported.
Just recently, a tax refund was delivered to the bank accounts of many people. This is because the IRS corrected its 2020 returns and determined that it overpaid on unemployment compensation because of the changes in the tax law.
As for the child tax credit, although the IRS releases announcements on social media pages for the child tax credit, many are still unsure why exactly they are receiving money from the government. The same thing happens when it comes to the all three stimulus checks approved by the government.
The TAS said that people should just check the codes regarding the money deposited on their bank accounts to not be confused. Each of the codes starts with “IRS TREAS 310.” However, if it is followed by “TAX REF,” this means that it is a tax refund. This includes the refunds being distributed to unemployment recipients after there was a correction on such returns. If it is followed by “TAXEIP3,” this means that the money is from a stimulus check. EIP stands for Economic Impact Payments. If you see the code “CHILDCTC,” this is an advanced payment for the child tax credit.