WHAT IS THE RECOVERY REBATE CREDIT?

The credit is for individuals who did not receive a Stimulus Payment or only received partial payment. These individuals may be eligible to claim the Recovery Rebate Credit when they file their 2020 & 2021 tax return. We will help you determine the amount you will receive.

The Recovery Rebate Credit is authorized by the Coronavirus Aid, Relief, and Economic Security (CARES) Act and the COVID-related Tax Relief Act. It is a tax credit against your 2020 and 2021 income tax. Generally, this credit will increase the amount of your tax refund or decrease the amount of the tax you owe.

Who can claim the Recovery Rebate Credit?

Eligible individuals who did not receive the full amounts of both Economic Impact Payments may claim the Recovery Rebate Credit on their 2020 or 2021 Form 1040 or 1040-SR.

You must file Form 1040 or Form 1040-SR to claim the Recovery Rebate Credit even if you are normally not required to file a tax return. 

Your Recovery Rebate Credit amount will be phased out if your adjusted gross income for 2020/2021 exceeds $150,000 if you are married filing a joint return or filing as a qualifying widow or widower, $112,500 if you are using the head of household filing status, or $75,000 if you are using any other filing status.

How do I find the amounts of my Economic Impact Payments?

You should have received a letter from the IRS-Notice 1444 for the first Economic Impact Payment, and you should receive Notice 1444-B for the second Economic Impact Payment.  Refer to them when completing your 2020 & 2021 tax return. If eligible for the Recovery Rebate Credit, you will use the information from these letters to determine the amounts to include on your income tax return and we will help you to calculate your credit amount.

Sources: IRS.gov, freep.com