Why Did I Get a Random Check From the IRS? Possible Reasons Explained

Receiving an unexpected check from the IRS can be confusing, especially if you weren’t anticipating a refund. While it might seem like an error or even a scam, there are legitimate reasons why the IRS issues payments without prior notice. Understanding these possibilities can clarify whether the money is rightfully yours and what steps, if any, you need to take.

Corrections for Prior Filings

The IRS routinely reviews past tax returns and may issue refunds if it finds errors that resulted in overpayments. This can happen when the agency detects a miscalculation, such as an incorrect taxable income figure or an improperly applied deduction. The IRS uses automated systems to cross-check reported income against employer W-2s, 1099s, and other third-party data. If a discrepancy results in an overpayment, they will send a refund without requiring the taxpayer to file an amended return.

Legislative changes can also lead to adjustments. For example, the American Rescue Plan Act of 2021 excluded up to $10,200 of unemployment compensation from taxable income for certain taxpayers. Many who had already filed before the law was enacted later received automatic refunds. Similar adjustments happen when Congress retroactively modifies tax laws affecting deductions or credits.

The IRS also corrects errors related to tax withholding and estimated payments. If a taxpayer overpaid due to an incorrect W-4 withholding or miscalculated estimated tax payments, the IRS may issue a refund after reconciling the actual tax liability. This can also occur if a taxpayer mistakenly reports duplicate income, leading to an overstatement of taxes owed.

Overlooked Refundable Credits

The IRS sometimes issues refunds when taxpayers qualify for refundable tax credits they didn’t claim. Refundable credits can generate a refund even if no tax was owed. If the IRS determines a taxpayer was eligible for a credit but didn’t claim it, they may process the adjustment automatically.

One common example is the Earned Income Tax Credit (EITC), which benefits low- to moderate-income workers. If the IRS finds that a taxpayer met the income and filing status requirements but failed to claim the EITC, they may issue a refund after recalculating the return. The Child Tax Credit (CTC) is another case where taxpayers sometimes miss out on additional amounts. While the standard CTC reduces tax liability, the refundable portion—known as the Additional Child Tax Credit (ACTC)—can result in a direct payment even if no taxes were due.

Education-related credits, such as the American Opportunity Tax Credit (AOTC), can also lead to surprise refunds. The AOTC provides up to $2,500 per eligible student, with up to $1,000 being refundable. If a taxpayer incorrectly reported tuition expenses or failed to claim this benefit, the IRS may correct the oversight. Similarly, the Premium Tax Credit (PTC), which helps offset health insurance costs for those who purchase coverage through the marketplace, can result in an additional refund if a taxpayer’s income was lower than initially estimated.

“Lookback” Rule Adjustments

Tax laws sometimes allow taxpayers to use prior-year income to calculate certain benefits, particularly during economic downturns. The “lookback” rule enables individuals to use income from an earlier tax year if it results in a larger credit. This rule has been applied to benefits like the Earned Income Tax Credit (EITC) and the Child Tax Credit (CTC) to prevent temporary income drops from reducing eligibility.

When Congress enacts temporary lookback provisions, the IRS may reassess tax returns to determine if a taxpayer would have received a larger refund using prior-year income. If a difference is found, an additional payment is issued. For example, during the COVID-19 pandemic, the Consolidated Appropriations Act of 2021 allowed individuals to use their 2019 income instead of 2020 for EITC and CTC calculations, leading to automatic adjustments for those who had already filed before the change was implemented.

The IRS also applies lookback provisions in disaster relief situations. Taxpayers in federally declared disaster areas may be allowed to use prior-year income to claim credits or deductions. If the IRS retroactively applies such provisions, affected taxpayers may receive an unanticipated refund.

Resolved Debts or Garnishments

An unexpected check from the IRS may be the result of a previously withheld refund being released after a past financial obligation was resolved. The Treasury Offset Program (TOP) allows federal and state agencies to intercept tax refunds to cover outstanding debts, such as delinquent federal student loans, past-due child support, or unpaid state taxes. If a taxpayer had a prior refund reduced or withheld due to such an obligation but later settled the debt or successfully appealed the offset, the IRS may return the withheld amount.

Offsets sometimes occur in error. If a taxpayer was wrongly flagged for a debt they did not owe—such as a misapplied child support obligation or a mistakenly reported state tax liability—they may later receive a refund correction. Similarly, if a taxpayer entered into a payment agreement for a federal tax debt and made sufficient progress under an installment plan, the IRS may release previously withheld refunds that were initially applied against the balance due.

Payment for Delayed Processing

Delays in IRS processing can sometimes result in unexpected payments, especially when the agency takes longer than usual to handle a tax return or adjustment. When this happens, the IRS may owe interest on the delayed refund, leading to a payment that exceeds the original amount expected by the taxpayer. These interest payments are typically issued separately from the refund itself, which can make them seem like an unexplained check.

Under Internal Revenue Code 6611, the IRS must pay interest on refunds if they are not issued within 45 days of the tax return’s due date or the date it was filed, whichever is later. The interest rate is determined quarterly based on the federal short-term rate plus 3%, meaning it fluctuates over time. During periods of high inflation or economic uncertainty, the interest rate on delayed refunds may be higher than in years with stable economic conditions. These payments are taxable and must be reported as interest income on the following year’s tax return, typically documented on Form 1099-INT if they exceed $10.

Processing delays can stem from high volumes of returns, manual reviews triggered by discrepancies, or system-wide backlogs due to legislative changes. During the COVID-19 pandemic, the IRS experienced significant delays in issuing refunds due to staffing shortages and new tax provisions. As a result, many taxpayers received interest-bearing payments months after filing. Checking IRS transcripts or notices can help confirm the source of an unexpected payment.