On Tuesday the Internal Revenue Service (IRS) said that all Economic Impact Payments (EIP), including the most recent $600 direct payments and the earlier $1,200 stimulus checks, had been sent. Those that were eligible for the EIPs should have received their payments by now, but there may be some in the mail still.
Still there are some taxpayers who haven’t received theirs at all or who received less than they believe they qualify for. Those individuals will have to claim the missing funds on their 2020 income-tax filing using the Recovery Rebate Credit.
The CARES Act which authorized the disbursement of the $1200 stimulus checks was passed in March, and within two weeks the IRS began sending out the first round of EIPs. The IRS issued more than 160 million direct payments to taxpayers, totaling over $270 billion.
In the latest round, approved in December as part of the $900 billion covid-19 relief bill, the IRS had until 15 January to send out the $600 stimulus checks. In all the agency has delivered 147 million payments, totaling more than $142 billion.
For the second round of direct payments the IRS used the information the agency had on file from taxpayers’ last return processed either in 2018 or 2019. For several filers who had gone through one of the popular tax filing software tools, the IRS had the wrong bank account.
Payments to approximately 13 million accounts were misdirected to temporary accounts used when customers choose to have their preparation fees deducted directly from their refund by the preparer. However the IRS and the tax preparers worked to get the issue solved and the payments have been rerouted.
The EIPs were based on taxpayers 2019 or even their 2018 income-tax filing, which means if their economic situation changed in 2020 for the worse, they might not have gotten the full amount due. You may be eligible to claim the Recovery Rebate Credit when you file your 2020 tax return, which you can find on Line 30 of the 1040 and 1040-SR forms.
On the contrary, if your economic situation improved during 2020 making you ineligible for the $1200 and $600 stimulus checks you needn’t worry. There was no provision in the law for those who received a direct payment to pay back all or part of the payment if they no longer qualify for that amount or would qualify for a lesser amount.
The IRS sent out a Notice 1444 after the EIPs were sent for tax payers to keep for their records. If you did not keep these records you can use the IRS Get My Payment tool. The agency updated the Get My Payment tool on 29 January and taxpayers can access the tool to see what the final status of their payment was for the first or second round of direct payments.
When taxpayers fill out their forms they will be able to calculate if their payment came up short. Many of the online tax preparing software systems will help you automatically calculate whether you were due additional money when you enter your income tax return information.
You can get the latest updates on the proposed third stimulus check, and other mooted aid measures such as the expanded child tax credit, by following our dedicated live blog.
CORONAVIRUS STIMULUS CHECKS
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