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The IRS is sending millions of unexpected refunds this week. See if you qualify

The Internal Revenue Service is issuing nearly 4 million refunds this week to those who overpaid their taxes on unemployment compensation they received last year.

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The Internal Revenue Service is issuing nearly 4 million refunds this week to those who overpaid their taxes on unemployment compensation they received last year.

This is separate from the child tax credit payments millions of Americans are also beginning to receive this week.

The refund average for those 4 million is $1,265, meaning some taxpayers owed refunds will receive more and some less, the IRS said in a statement.

Refunds by direct deposit began Wednesday and those by paper check began on Thursday, the IRS said.

"To ease the burden on taxpayers, the IRS has been reviewing the Forms 1040 and 1040SR that were filed prior to the law's enactment to identify those people who are due an adjustment," the agency said.

For those who overpaid, the IRS will either refund the overpayment or apply it to outstanding taxes or other state or federal debts owed.

Related video: Child tax credit payments start going out this week


The IRS previously said that more than 10 million people had submitted their 2020 tax returns before the American Rescue Plan Act was signed March 11. Under the act, the first $10,200 of unemployment compensation earned last year is excluded from taxable income.

Most taxpayers don't need to take any action to receive the refund; however, because of the excluded unemployment compensation, some taxpayers are now eligible for deductions or credits not claimed on their original return. People should file a Form 1040-X if this applies to them, the IRS said.

For more information on whether you need to file an amended return, visit the IRS website.