Stimulus Check and Recovery Rebate Credit

Let’s Talk about 2nd Stimulus Check, 3rd Stimulus Check and Recovery Rebate Credit

Who is Eligible for Stimulus Checks

Since the pandemic’s start on March 11, 2020 (the date the World Health Organization declared the COVID-19 outbreak a pandemic), to date, the U.S. government has made three rounds of stimulus payments to American taxpayers. 

I’ve heard about “Stimulus Check,” “Economic Impact Payment,” and “Recovery Rebate Credit.” Are they all the same thing? How are they related?

Since the pandemic began, Congress has passed two economic stimulus bills that have included direct payments to American taxpayers.

• The CARES (Coronavirus Aid, Relief and Economic Security) Act of 2020 included a round of one-time payments of $1,200 per adult and $500 per dependent child.
• The Consolidated Appropriations Acts of 2020 included a second round of one-time payments of $600 per adult and $600 per dependent child.
• The American Rescue Plan Act of 2021 included a third round of one-time payments of $1,400 per adult and $1,400 per dependent child.

The exact amount received varied depending on income. Many received these one-time cash payments as 1st, 2nd, and 3rd stimulus checks. Or debit cards sent to their addresses or direct deposits to their bank accounts in 2020 and 2021.

Economic Impact Payments

The IRS refers to these payments as economic impact payments which is why you see that term being used on their website, including their “Get My Payment” tool.

Recovery Rebate Credit

The stimulus checks were, in fact, advance payment of a federal tax credit known as the recovery rebate credit. Eligible taxpayers who didn’t receive their payments must file their tax returns to take advantage of this credit and claim their missing stimulus payments. You may also be eligible to claim this credit on your tax return if you received less than the full amount.

You’ll need to file your 2020 tax return to receive the Recovery Rebate Credit equivalent to the 1st and 2nd stimulus checks/economic impact payments. And you’ll need to file your 2021 tax return to receive the Recovery Rebate Credit equivalent to the 3rd stimulus check/economic impact payment.

Who is eligible for the 1st stimulus check?

All U.S. citizens, permanent residents, and qualifying resident aliens with a social security number could receive payments. There was no age requirement, but taxpayers could not be someone else’s dependent. For taxpayers with dependents, dependents had to be under 17 years old to be eligible for the $500 payments for dependents.

Stimulus checks were not dependent on employed status. However, there were income limits to qualify for the full amount. As a result, the stimulus check amount began to phase out in steps. Incomes above $75,000 for single filers, $112,500 for head of household filers, and $150,000 for married filing jointly filers.

The 1st stimulus check, like all three economic payments, is not counted as income for means-tested government benefit programs like Medicaid, SNAP, and TANF.

Who is eligible for the 2nd stimulus check?

All U.S. citizens, permanent residents, and qualifying resident aliens with a social security number. Married couples where one spouse had an individual taxpayer identification number could also receive payments. There was no age requirement, but taxpayers could not be someone else’s dependent. For taxpayers with dependents, dependents had to be under 17 years old to be eligible for the $500 payments for dependents.

Stimulus checks were not dependent on employed status. However, there were income limits to qualify for the full amount. As a result, the stimulus check amount began to phase out in steps. Incomes above $75,000 for single filers, $112,500 for head of household filers, and $150,000 for married filing jointly filers.

The 2nd stimulus check, like all three economic payments, is not counted as income for means-tested government benefit programs like Medicaid, SNAP, and TANF.

Who is eligible for the 3rd stimulus check?

All U.S. citizens, permanent residents, and qualifying resident aliens with a social security number or individual taxpayer identification number could receive payments. There was no age requirement, but taxpayers could not be someone else’s dependent. For taxpayers with dependents, dependents can be any age and be eligible for the $1,400 payments for dependents.

Stimulus checks were not dependent on employed status. However, there were income limits to qualify for the full amount. As a result, the stimulus check amount began to phase out in steps. Incomes above $80,000 for single filers, $120,000 for head of household filers, and $160,000 for married filing jointly filers.

The 3rd stimulus check, like all three economic payments, is not counted as income for means-tested government benefit programs like Medicaid, SNAP, and TANF.

I didn’t receive one or more of the stimulus checks. Can I still claim my payments?

The IRS recently finished issuing all 3rd-round stimulus checks; they were sent out by December 31, 2021. All 1st- and 2nd-round stimulus checks went out in 2020. However, if you were eligible but didn’t receive one or more of your stimulus checks. It’s not too late to get the money the U.S. government made available to help people out during the pandemic. 

You still have time to claim your payments if you didn’t receive one or more of the stimulus checks despite being eligible. You will need to file a tax return where you will claim your payments as a tax credit. And then you will receive your payments as part of your tax refund.

Are you one of the people missing their 1st, 2nd, or 3rd stimulus check, or did you receive less than the full amount for these payments? In that case, take action today to claim this additional money. Visit PriorTax.com today to get started.

Missing your 1st or 2nd stimulus check?

Then, get started filing your 2020 tax return to claim your 2020 Recovery Rebate Credit. Take advantage of PriorTax.com’s simple tax preparation software to ensure that you don’t leave any of your eligible tax credits on the table.

Missing your 3rd stimulus check?

The IRS has announced that they will begin processing 2021 tax returns on February 12th. But you don’t need to wait until then to start preparing your 2021 tax returns. If you already have the information you need, you can get started today. PriorTax.com’s easy-to-use web-based tax preparation software is up and running for 2021 tax returns.

This entry was posted on Monday, January 10th, 2022 at 10:35 pm and is filed under Tax Deductions and Credits, Tax for Business, Tax Tips and Tricks, Taxes for Prior Years. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.