If you didn’t receive the $1200 stimulus check from the IRS as part of the CARES act earlier this year, it might not be too late. The deadline to register your claim after not receiving the first payment was November 21st. Missed it? Learn about the Stimulus Rebate Tax Credit.
Thankfully the IRS has offered those who fall into the category above another chance to benefit from the $1200 stimulus. They have introduced the “Recovery Rebate Credit”. Authorized by the CARES act, this program allows you to apply a tax credit to the tune of the $1200 stimulus payment that you did not receive.
The IRS states “any eligible individual who did not receive the full amount of the recovery rebate as an advance payment, also known as an Economic Impact Payment, can claim the Recovery Rebate Credit on a 2020 Form 1040 or Form 1040-SR when filing their taxes in 2021.
Originally, those who had not received the check back in April were prompted to input their information utilizing the IRS’s “non-filer” tool. Those who had done so by the November 21st deadline would be cued up to receive the payment.
This is great news for those of you who have not yet received the money, and it may be your final chance to do so. Many of our current clients have been reaching out to us after hearing about the rebate, and here are some of the questions they’ve had:
Q: I was supposed to register online but never did, so I didn’t get the $1,200 stimulus. Is it too late?
A: No, it’s not too late! The purpose of the program is to allow people who did not receive the initial check, or missed the November 21st deadline to receive the stimulus in one form or another.
Q: How much is the Tax Rebate Credit?
A: The credit is up to $2,400 if you file a joint tax return or up to $1,200 for all other eligible individuals. Those with qualifying children will receive up to an additional $500 per qualifying child.
Q: Is there an income limit to claim the tax credit rebate?
A: If your adjusted gross income exceeds $150,000 if you are married filing a joint return the credit will begin to be phased out. $112,500 if you are using the head-of-household filing status, or $75,000 if you are using any other filing status.
This same rule applied to the original $1200 economic impact payment (EIP) that you did not receive when it was first sent.
Q: What if I already received a partial payment, but not the full $1200?
A: In this situation, you would need the amount that was calculated by the IRS from a letter called “Notice 1444 – Your Economic Impact Payment”. This would be included in the documents you provide your accountant when filing for 2021.
Additionally, parent’s that were also set to receive the “$500 per dependent” payment, and did not, may also be eligible to claim these amounts when filing in 2021. Of note, is that exist a few instances where parents are/ divorced & share joint custody of a dependent, in these cases each parent can get a $500 payment per eligible child, so you may be eligible without even knowing it!
Given the tumultuous nature of this past year and the economic hardship many have faced, we encourage everyone who did not receive the payment to take advantage of this opportunity. While we wait on congress to pass the next round of stimulus, many of those who have not received anything are still struggling. This is why we want to make sure that all of our clients are taken care of, and are taking advantage of the benefits the government provides.