![IRS Updates FAQs on Third-Round Economic Impact Payments](https://cstaxgroupinc.com/wp-content/uploads/2022/04/irs-updates-faqs-on-third-round-economic-impact-payments.png)
The Internal Revenue Service is going the extra mile to ensure taxpayers have the newest information on the third-round Economic Impact Payment.
The agency’s frequently asked questions on the third-round payment have been updated with new dates and other information so taxpayers can make better decisions. The new FAQs are published in the IRS Fact Sheet 2022-22.
The third-round Economic Impact Payment was authorized by the American Rescue Act of 2021. It was structured as an advance payment of the 2021 Recovery Rebate Credit.
Filing a 2021 income tax return is vital for those taxpayers who either did not receive the third-round Economic Impact Payment (EIP), or those who didn’t get the full amount. These taxpayers have to file a return claiming the Recovery Rebate Credit which, in effect, may give them another chance at the EIP.
The Recovery Rebate Credit can reduce any tax the taxpayer owes or can be included in their refund.
There is a wide range of updates
The IRS has updated frequently asked questions and their answers in nine different topic areas, with several updates in each topic. The updated topics include: General Information; Eligibility and Calculation of the Third Payment; Plus-Up Payments; EIP Cards; Requesting My Payment; Social Security, Railroad Retirement and Department of Veterans Affairs benefit recipients; Receiving My Payment; Reconciling on Your 2021 Return; and Payment Issued But Lost, Stolen, Destroyed or Not Received.
The IRS says it has issued all the third-round EIPs that were outstanding and due taxpayers. This includes the “Plus-Up” payments, leaving a 2021 tax return as the only way to now apply for the third-round payment.
Families and individuals in the following circumstances, among others, may not have received the full amount of their third-round Economic Impact Payment because their circumstances in 2021 were different than they were in 2020.
These families and individuals may be eligible to receive more money by claiming the 2021 Recovery Rebate Credit on their 2021 income tax return:
- Parents of a child born in 2021 who claim the child as a dependent on their 2021 income tax return may be eligible to receive a 2021 Recovery Rebate Credit of up to $1,400 for this child.
- All eligible parents of qualifying children born or welcomed through adoption or foster care in 2021 are also encouraged to claim the child tax credit—worth up to $3,600 per child born in 2021—on their 2021 income tax return.
- Families who added a dependent—such as a parent, a nephew or niece, or a grandchild—on their 2021 income tax return who was not listed as a dependent on their 2020 income tax return may be eligible to receive a 2021 Recovery Rebate Credit of up to $1,400 for this dependent.
- Single filers who had incomes above $80,000 in 2020 but less than this amount in 2021; married couples who filed a joint return and had incomes above $160,000 in 2020 but less than this amount in 2021; and head of household filers who had incomes above $120,000 in 2020 but less than this amount in 2021 may be eligible for a 2021 Recovery Rebate Credit of up to $1,400 per person.
- Single filers who had incomes between $75,000 and $80,000 in 2020 but had lower incomes in 2021; married couples who filed a joint return and had incomes between $150,000 and $160,000 in 2020 but had lower incomes in 2021; and head of household filers who had incomes between $112,500 and $120,000 in 2020 but had lower incomes in 2021 may be eligible for a 2021 Recovery Rebate Credit.
As we mentioned, the only way to get the Rebate Recovery Credit is to file a 2021 tax return; the credit will not be calculated automatically by the IRS.
Didn’t get a third-round EIP?
Those people who believe they missed out on the third-round stimulus payment can visit the Recovery Rebate Credit web page on the IRS website to figure whether they are eligible for the Recovery Rebate Credit.
Taxpayers can also go online to their IRS online account, and click on “Tax Records” to see what the IRS sent them for a third-round EIP.
The Internal Revenue Service has also sent out Letter 6475 to taxpayers, using the addresses they have on file. These letters seek to confirm the amount of the taxpayer’s third Economic Impact Payment, along with any plus-up payment they received for tax year 2021.
For more information, visit the Recovery Rebate Credit page on IRS.gov.
Information is also available about taxpayer reliance on IRS FAQs.
Sources: IRS provides revised frequently asked questions on Third-round Economic Impact Payment; Fact Sheet 2022-22