Third Stimulus Check Payment
If you did not receive your third stimulus check, this is to be claimed on your 2021 Tax Return as the Recovery Rebate Credit or RRC. This refundable tax credit was introduced in 2020 and was composed of stimulus one and two; the 2021 credit is only stimulus three. All these were advance payments of the credit; claim your 2021 Recovery Rebate Credit when you prepare and mail your 2021 Return. Tip: enter the amount of the credit you are owed on Form 1040, Line 30 based on Letter 1444-C or a direct deposit description of IRS TREAS 310 TAXEIP3. Double-check your personal records to be sure of whether or not it was received; the IRS will adjust your refund if you claim it wrongly.
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The IRS issued Letter 6475, Your 2021 Economic Impact Payment(s), through March 2022, stating how much they issued you for Stimulus Three.
This payment was composed of a $1,400 stimulus check to qualifying individuals and $1,400 per each of their qualifying dependents as part of the American Rescue Plan Act, or President Biden's early 2021 tax plan. Additionally, there were changes to the 2021 Child Tax Credit, the 2021 Earned Income Tax Credit, 2021 Child and Dependent Care Credit, and previous year 2020 unemployment benefits - not 2021. See information about Stimulus Payment One and Stimulus Payment Two. If you did not receive the Stimulus 1 or 2 payments, claim the Recovery Rebate Credit on your 2020 Tax Return by filing a tax amendment (first, verify that it was not already claimed on Line 30 on Form 1040). If you did not file a 2020 return, see how to prepare a previous year return. The IRS Get My Payment tool is no longer a functioning tool as the IRS is not issuing anymore stimulus payments.
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Stimulus Payment Three Requirements
The third stimulus payment requires the eligible recipient to be a U.S. citizen or resident alien, possess a Social Security number, and not be claimed as a dependent. You do not need income to claim the third stimulus nor do you need to live in the U.S. For married couples where only one spouse has a valid Social Security Number or SSN, you were eligible for the third payment as it followed the same ruling as the second Economic Impact Payment where the spouse with the valid SSN received the payment. Taxpayers without an SSN were not eligible, but if they had dependents with valid SSNs, they may have received payment for their qualifying dependents. For married filing joint taxpayers where one is active duty military, only one spouse needed to have an SSN and they would both receive the payment.
The third stimulus payment amounts were as follows:
- $1,400 for single filers, head of household, married filing separate, and widower. See information about your IRS filing status here.
- $2,800 for couples claiming married filing jointly.
- $1,400 per eligible, claimed dependent. Dependents and children (e.g. college students or disabled adults) over the age of 17 were eligible for an additional $1,400 for this round of stimulus payments. Find out if someone qualifies as a dependent here.
- Social Security, railroad retirement income recipients, veterans, supplemental security (SSI), or disability income recipients should have received payment based on Form SSA-1099 or Form RRB-1099 just as they did for Stimulus 1 and 2. If you did not receive the full amount for your dependents, you would have to file a 2021 Return to include your dependents. You did not need earned income to receive the stimulus payments.
- If you did not file a 2019 or 2020 return and had no income in these years, thus would not have filed a return, you will need to prepare and file a 2021 Tax Return. Additionally, we recommend filing a 2020 return to claim stimulus 1 and 2.
The payment phases out for singles with adjusted gross incomes (AGI) between $75,000 and $80,000. For married filing joint taxpayers, the phase out threshold falls between $150,000 and $160,000. Head of household filers will see a phaseout between $112,500 and $120,000. The phase out decreases the payment by 5%, or $5 for every $100 over the lower point of the range. This goes until it reaches the high point where it is brought down to $0 and the taxpayer is ineligible.
Similar to the second stimulus payment, the third payment was an advance payment, thus it was not subject to past due state or federal debts nor administrative offsets. If you claim it as part of your refund, it is subject to garnishment or offset.
Third Stimulus Scenarios
Below, find various scenarios that may apply to your situation, including dependent disputes and missing stimulus payments. Most of this information is archived for informational purposes as the IRS is no longer issuing stimulus checks.
My ex-spouse and I alternate years claiming our dependent; who should get the additional third stimulus payment?
The third stimulus payment was an advance payment of the Recovery Rebate Credit on the 2021 Tax Return. The first two stimulus payments were part of the 2020 return, thus were claimed on Form 1040 when filing a 2020 Tax Return. This means that, if you and your spouse or ex-spouse alternate years, then the rightful recipient of the third stimulus payment is the spouse who is going to claim the dependent on the 2021 Tax Return. This can lead to some complications with the IRS who likely issued the payment based on 2020. It is best if taxpayers can communicate on this matter; when filing for 2021, the taxpayer who may have wrongly received the credit (as per the agreement) may owe it on their 2021 return.
Someone received my additional stimulus for claiming my dependent(s) on the 2020 tax return.
If for any reason someone claimed your dependent in 2020 and received the additional stimulus payment and they were in fact not eligible to, they may have been made to pay it back when they filed their 2021 Return. If you know who claimed your dependent, it is best for both parties to communicate the matter. The person who wrongly claimed the dependent may have to file a tax amendment. Ideally, you would not want to have the incorrect recipient hand over the funds as this may complicate things when filing. Instead, consider the amendment or simply file your 2021 returns and report your stimulus information. The IRS should then issue the stimulus funds to the person rightfully claiming the dependent and the person who wrongly received it would owe it to the IRS.
This matter may also have implications of the advance Child Tax Credit.
Someone claimed my dependent on the 2021 tax return and claimed my stimulus payment.
If your dependent was wrongly claimed on the 2021 tax return, then the person who claimed them would receive the stimulus payments. See how to prepare your return if your dependent is claimed. Send in your return to the IRS and a few forms to file your return with your qualifying dependent and receive this tax credit. This will require the IRS to contact you for more verification to determine who should claim the dependent.
I did not receive the third stimulus payment for any reason.
Some taxpayers did not receive the third stimulus or the full amount. If you did not receive this, claim the 2021 Recovery Rebate Credit on your 2021 Return similarly to how the 2020 RRC was claimed by filing a 2020 Return.
I received a letter stating I did not activate a debit card for an Economic Impact Payment.
The IRS issued debit cards with the third stimulus payment instead of direct deposit or check for some. If you received but did not activate this card, you may have been issued a letter with instructions on how to do so or how to request a new one. The card came in a white envelope with the U.S. Treasury Seal on the front, the Visa name on the front, and MetaBank on the back. If you were issued the card and didn't activate it, you cannot claim the third stimulus on your return because the IRS has given you the funds, regardless of if you used them. The only way to get your payment is through the card; see more details on EIPcard.com. Once activated, you can transfer the funds to a bank account or request the money via check.
In April of 2021, the IRS put out the following information regarding 2020 returns and the stimulus payments:
- Taxpayers who were issued a third stimulus payment based on their 2019 return may have been eligible for a supplemental payment or "plus-up" payment from the IRS once they submitted their 2020 return if their information changed. The plus up payment is not a fourth stimulus check.
- If your tax situation changed from 2019 to 2020 and you were owed more than the third stimulus payment you received, the IRS should have issued you an additional plus up payment once your 2020 return had been filed.
- For example, if you had a child in 2020, added a dependent to your 2020 return, and you received the third stimulus payment before filing your 2020 return, the IRS will issue you the additional credit for your dependent once they have received your updated return. This carries into 2021; if your information has changed, report this on your 2021 Tax Return so the IRS can issue any funds you are owed.
- The IRS was making efforts to help those experiencing homelessness and/or those without a permanent address. As such, they allowed those to file a 2020 return using an alternative address (the address of a friend, relative, or shelter, for example).
- Taxpayers experiencing homelessness may also have been eligible for the Earned Income Tax Credit or EITC if they met additional criteria.
What you Can Do Now
Prepare and mail - not e-file - a 2021 Return to claim the credit and give the IRS your latest bank information and address. Below, find examples of certain scenarios for those in specific situations. See simple instructions to claim a missing stimulus payment.
What if I don't have any income for the third stimulus payment? If you do not have taxable income, do not normally file a tax return, or receive only nontaxable Social Security benefits or Supplemental Security Income, the IRS should have issued your payment through record with the respective agencies. Ideally, you should have seen your payment come through direct deposit if you had that information on record or through the mail as a check or prepaid debit card. If you did not receive the payment or you do not receive the full funds for your dependents, file a 2021 tax return to claim your payment.
How do I claim the third stimulus check as a non filer? If you used the non-filer tool to file a 2019 return in 2020 to receive the first stimulus check or a 2020 non-filer return to claim both, then you do not have to file an additional non-filer return. The IRS will use the information from your original non-filer return to issue a third stimulus check based on the information from that return. If you are a non filer and did not file a return for the previous stimulus checks or simply did not get your full amount, you can file a 2021 return to claim the stimulus three.
Dependents in 2021: If you added an additional dependent, file your 2021 return so the IRS could include this as part of the third stimulus payment calculation or your 2021 Recovery Rebate Credit.
Important Tax Changes from the Stimulus Three Bill
The following information applies for 2021 Returns - the eFile Tax App was updated to reflect these changes when you prepared your return. Sign up now and e-file your current year return - not 2021 - in the year it is due so you do not have to fill out and mail complicated tax forms.
Child Tax Credit (CTC): The bill adjusted how the Child Tax Credit worked in 2021 as well as increased the amounts - this was referred to as the advance Child Tax Credit. The credit allowed 17-year-old dependents to qualify and provided up to $3,000 per qualifying child or $3,600 per qualifying child under age 6. The credit was also fully refundable - it has always been a partially refundable credit - and was made more accessible for those without taxable income by removing the $2,500 earnings floor.
Similarly to the stimulus payments and the Recovery Rebate Credit, you were able to claim a portion of the Child Tax Credit as advance payments. Throughout the year, you may have received payments on a scheduled basis in 2021 and claimed the remainder of the credit on your 2021 tax return. The advance Child Tax Credit payments were paid to qualifying taxpayers on the 15th of each month of 2021 from July 15 to December 15.
Child and Dependent Care Credit: In addition to the CTC, if you make qualified payments to a childcare provider so you can work or look for work, you may be able to claim the Child and Dependent Care Credit (CDCC). For 2021, this credit had been greatly enhanced, offering more than double the original credit amount as a fully refundable tax credit. Taxpayers with two or more dependents may have been eligible to claim up to $8,000 on their 2021 tax return. Additionally, if you contributed to a Flexible Spending Account (FSA), you could have contributed up to $10,500 to this account through 2021.
Earned Income Tax Credit: The American Rescue Plan allowed qualifying taxpayers at age 19 and older to qualify - previously 25 - and eliminated the maximum age of 64. Additionally, those without qualifying children saw increases to the amount they received as the act increased the percentage amount and the phaseout limits. The maximum EITC credit was raised from $540 to around $1,500 for those without dependents. Additionally, disqualifying investment income limits were raised from $2,200 to $10,000. See details on the Earned Income Tax Credit or EITC.
Health Care, Job Loss, COBRA: The Consolidated Omnibus Budget Reconciliation Act program allows those who lost their job to stay enrolled in their employer healthcare plan. This can typically be costly as the taxpayer would be responsible for the full amount of healthcare coverage. Under the ARPA, if you were affected by job loss due to COVID-19 and enrolled in COBRA, the government may have paid 100% of your CORBA premium from April 1, 2021 to September 30, 2021. This applied for laid off employees as well as their family members. Additionally, for those who purchased health insurance through the marketplace, you may have been able to receive a higher premium tax credit.
Lowered Threshold for Third Party Transactions (Failed to Pass, May Not Apply): If you make transactions over third-party settlement organizations or TPSOs, income may be subject to taxes. Cash exchanges for goods and services, perhaps as part of your business, are subject to federal income tax and self-employment taxes. Additionally, sales on platforms like eBay or Etsy may be subject to taxes if the sale(s) result in a gain. In the past, the platforms would be required to issue you a 1099-K for this income if you earned $20,000 or more - they may have issued the form if you earned less, but were not required to. However, ARPA aimed to change the threshold to transactions of $600 or more, but it failed to pass. If this is ever changed or passed, if you receive $600 in a year in these scenarios, this will be reported to the IRS by the organization and you will be responsible for reporting the same amount on your income tax return. See how to report a 1099 form.
Tax Changes for 2020 Unemployment Benefits
The below information applies only to 2020 Tax Returns. If you did not file a 2020 return, see forms and resources for previous year tax returns.
- If you e-filed your 2020 return on or before March 15, 2021 and reported unemployment income and you want to adjust your income taxes based on the American Rescue plan of March 12, 2021, you do not have to do anything. The IRS confirmed that they will issue refunds for those who filed before the bill was passed and implemented into tax preparation systems. States are electing to conform or decouple from the unemployment changes - see how your state is handling this situation as a state tax amendment may be due.
- The IRS began issuing these refunds as of May 10, 2021. There is no tracking nor lookup tool, but taxpayers may be able to see a scheduled transaction in their IRS account - see how to create an IRS account. Here, navigate to the View Tax Records on the homepage and click the Get Transcript button. In the dropdown menu, select Federal Tax, click Go, and you will land on a page displaying your IRS history - transactions, income tax returns, etc. Here, select 2020 Account Transcript and view the PDF that opens which displays all transactions from 2020 - 2021. You may see an entry titled Refund issued under the Transactionssection - if this date is some time in late May or early June and it is not your 2020 tax refund, this may be your UCE refund.
- If you were issued a refund as married filing jointly based on the assumption that both you and your spouse received unemployment benefits (meaning the exclusion was $20,400 instead of $10,200), then you do not have to repay this as confirmed by the IRS if you believe you were not owed this much. If you were only entitled to the $10,200 exclusion, but received the $20,400 exclusion, you do not need to pay back half or even any of this nor do you need to contact the IRS or file an amendment.
- If for any reason you did not receive this refund, contact the IRS.
- If you e-filed on or after March 16, 2021 and reported unemployment income, the eFile tax app will have calculated all necessary adjustments; you did not have to do anything else. More details below.
- Important: The only reason to file a federal tax amendment with this change, as confirmed by the IRS, is that if doing so qualifies you for a new tax credit, such as the Earned Income Tax Credit. For example, if you filed a return and did not receive the credit before the exclusion was applied, but now you are eligible based on the exclusion, you would be able to file an amendment and claim this credit. If you already claimed the credit, but are now eligible for a larger amount, the IRS will issue this as well. Note: the IRS stated on June 4, 2021, that they can adjust this for single taxpayers with no dependents who are newly eligible for the EITC.
- State returns may have been affected by ARPA Unemployment.
Unemployment benefits are considered taxable income and thus must be reported on a tax return. A recipient of unemployment compensation will receive a Form 1099-G reporting the amount they received as well as the amount withheld. Many taxpayers filed a tax return reporting unemployment benefits for the first time in 2020.
The new bill, however, made the first $10,200 of unemployment benefits nontaxable if the adjusted gross income of the taxpayer was less than $150,000. Since many taxpayers have filed a return reporting this income already, there will be adjustments due.
What this means for taxpayers is that they may be due a refund if they have already filed or their tax liability was decreased when they filed a 2020 return.
For example, if you received $9,000 of unemployment compensation during 2020, your entire amount is nontaxable under the bill. If you received $20,000 of unemployment income, then $10,200 of that income is tax free and the remaining $9,800 will be taxed.
Did you receive an IRS Notice CP12 as a result of Recovery Rebate Credit amounts or stimulus payments? Follow the instructions on the CP12 as outlined on this page.
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