The tax filing season has formally started in the US. It suggests that many people are looking for answers to their filing-related questions. The federal government provided qualified Citizens with three rounds of stimulus checks during the early phases of the COVID-19 epidemic.
Government Introduced Recovery Rebate Credit During Pandemic
The federal government introduced the Recovery Rebate Credit during the 2020 coronavirus epidemic; stimulus checks were prepaid installments of this tax credit. The first and second waves of stimulus payments were issued in early 2021 and 2020, respectively.
The third batch of checks was made from March to December 2021. The IRS stopped distributing stimulus payments on January 26, 2022. On their 2020 or 2021 federal tax returns, taxpayers who did not receive a stimulus check or got one for less than the full amount may still be eligible to claim the Recovery Rebate Credit. You must file tax returns, even if you don’t regularly do so, to be eligible for the benefit for those years.
Stimulus Check; Who Is Eligible?
The IRS advises qualified individuals who are filing a claim for the Recovery Rebate Credit to understand that the stimulus funds dispersed apply to multiple tax years.
The initial two stimulus funds that didn’t arrive can, therefore, only be written off on a federal tax return submitted in 2020, and the 3rd stimulus payment that was not received can only be written off on a federal tax return submitted in 2021.
According to the IRS’s website, based on whether the first, second, or 3rd advance payment is absent, you must file a 2020 tax return or a 2021 tax return to be eligible for the Recovery Rebate Credit.
To accurately compute the credit and determine whether you are eligible to claim the 2020 or 2021 Recovery Rebate Credit for skipped stimulus checks, you will need the tax year and amount of the payments you did receive.
According to the IRS, you can calculate the credit using the Form 1040 Recovery Rebate Credit Worksheet or your tax preparation program. The worksheet can be found on the final page of your return reports Newsbreak Original.
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