Stimulus check tax credit: How to claim your missing payment on your 2020 refund
Tax season officially kicks off on Friday, and if you’re one of the millions of people who never got their first or second stimulus check, you’re going to need to claim that money when you file your 2020 tax return — even if you don’t usually have to file taxes. You could find yourself in this situation for several different reasons — it’s possible the IRS made an error, that you’re missing money for your dependents, that your check was mistakenly garnished or that you’re a tax nonfiler (on SSI or SSDI, or if you’re retired) who needed to take an extra step.
Whatever the reason, if you’re missing any money, you can claim your full stimulus check amount as a Recovery Rebate Credit on your tax return. This credit combines your stimulus money with your tax return. So while you won’t get a separate check, you could get either a larger tax refund or pay a smaller tax bill. (If you have any outstanding debts, the IRS could potentially garnish some or all of your refund to pay them.) We recommend filing your taxes as soon as possible and signing up for direct deposit.
To start the Recovery Rebate Credit claim process, you should first confirm your payment status online through the IRS. If you see a confusing message or a possible error, you may be a candidate for a rebate or a payment trace. Note there may be additional steps required if you’re filing a tax extension. Here’s everything you need to know about filing for a Recovery Rebate Credit. And this is what we know about a third stimulus check including how much money you could get, the conversation around “targeted” checks and how fast a third stimulus payment might arrive.
How do I claim a Recovery Rebate Credit on my taxes?
If you belong to one of the groups outlined below, estimated your total for the first stimulus payment or used our calculator to get an idea of your payment for the second and think the IRS didn’t send the full amount you qualified for, you have another chance this year to claim missing stimulus check money through an IRS Recovery Rebate Credit.
You need to file for the credit when you submit your federal tax returns this year. The IRS will start processing 2020 tax returns on Feb. 12, and federal tax returns will be due April 15. (In 2020, the IRS extended the deadline to July 15 as a result of the COVID-19 pandemic.)
While the IRS doesn’t have final instructions yet for every personal situation (more on these below), the agency does say that people who file taxes can use what will be called the Recovery Rebate Credit on the 2020 Form 1040 or Form 1040-SR to claim a catch-up payment. The IRS will provide a Recovery Rebate Credit Worksheet to help you work out if you’re missing a payment and for how much.
To start filing for a partial check rebate, you’ll need the IRS’ calculated amount from the letter the IRS sent confirming your payment. This was called Notice 1444 for the first payment and Notice 1444-B for the second payment.
If you file for the credit and are owed money, you’ll either see the amount of your tax refund increased or the amount of tax you owe lowered, depending on the amount of stimulus money you’re eligible to receive.
If I’m a nonfiler and don’t usually have to file my taxes; how can I get my missing stimulus money?
Last fall, the IRS sent letters to 9 million Americans who may have qualified for a payment but perhaps didn’t know they needed to register to claim it. This group — which the IRS categorizes as “nonfilers” — includes people who didn’t file a tax return in 2018 or 2019, such as older adults, retirees, SSDI or SSI recipients and individuals with incomes less than $12,200. People in this group needed to file a claim using the Non-Filers tool by Nov. 21. The IRS said if you missed the deadline you can claim the payment through the Recovery Rebate Credit when you file a 2020 federal income tax return:
When you file a 2020 Form 1040 or 1040SR you may be eligible for the Recovery Rebate Credit. Save your IRS letter — Notice 1444 Your Economic Impact Payment — with your 2020 tax records. You’ll need the amount of the payment in the letter when you file in 2021.
If you meet the requirements, you can get started with your claim using the IRS’ free tax-filing service. We have more detailed instructions for how nonfilers can file a tax return to claim missing stimulus money here.
Can the IRS garnish my tax refund and missing stimulus money to cover outstanding debts?
Yes, it can. Stimulus checks — whether you got one in the mail or are filing for one on your taxes — are technically considered a tax credit. While one IRS rule allows the agency to reduce a taxpayer’s refund to repay outstanding debts like past-due child support, unpaid student loans and certain other federal and state liabilities, the CARES Act stated that stimulus checks could not be garnished for these purposes, except for overdue child support.
The December stimulus package went a step further and protected the second round of stimulus checks from all garnishment, including for child support. However, it also limited that exception only to advance payments, and retroactively revised the CARES Act’s rules as well — meaning that your Recovery Rebate Credit that arrives on your tax refund for missing stimulus money is treated differently from the stimulus money that arrived for others in the mail, according to the Taxpayer Advocate Service, an independent organization within the IRS.
Bottom line: If you’re eligible for a stimulus payment through a Recovery Rebate Credit, but you have certain outstanding debts, some or all of your credit could be withheld to pay those debts, the TAS wrote in a blog post.
Though the IRS has told taxpayers that they can claim their full missing stimulus payment on their 2020 returns, this is inaccurate based on the law change, the TAS said. The IRS told the TAS that it “has been looking into this issue and is exploring ways to exercise its discretion to help vulnerable taxpayers, taking into account the limitations of its IT systems, resource issues, and a rapidly approaching start to the filing season.”
How do I claim any missing stimulus money for my child dependents?
Under the CARES Act passed in March, each qualifying child dependent — those 16 years old and younger — was eligible for a $500 check. But some people’s payments were short $500 for each eligible dependent. If you claimed it by Nov. 21 of 2020, you should have received the payment in December 2020.
As with the nonfilers, if you missed that deadline, the IRS says you can claim the payment on your 2020 federal tax return this year, by filing a 2020 Form 1040 or 1040-SR. Use our stimulus check calculator to get an idea of how much you may be owed.
In the second stimulus check, which went out in December, children under 17 were each allotted $600 as part of the family total.
Note that in a few cases, where parents are separated or divorced and share joint custody of a dependent, each parent can get a $500 or $600 payment per eligible child, for the first and second checks, respectively. So you may not even be aware you’re eligible for the payment, to begin with.
What if my stimulus check was accidentally garnished?
Although there are a few cases where the federal government or a debt collector could seize your first payment to cover any outstanding debt, in general, if you qualify for a check, it’s yours to spend or save as you want. One area where the federal government can garnish your first stimulus check is for overdue child support. However, if the parents are separated or divorced, only the spouse who owes child support should have the check seized. You can’t have your second check seized for overdue support if it was sent as an advance check (see above).
According to the IRS, the parent who doesn’t owe child support should receive their portion of the first payment without having to take action. If you haven’t received your check, the IRS says it’s working to send out the missing payments. While you don’t have much recourse to appeal IRS decisions, you can also try the Non-Filers tool to create a record of your claim.
I used CNET’s stimulus calculator, and I believe the IRS owes me more money than I actually received. What can I can do?
If you use our first stimulus check calculator or second payment calculator and find you may have qualified for a larger stimulus payment than you received, use the IRS Get My Payment tool to see if a check has been approved. If the IRS is waiting for information from you that it needs to make your payment, you might still be able to claim your money this year as a Recovery Rebate Credit.
What happens if I’m a US citizen living abroad, living in a US territory or if I’m not a citizen?
The IRS has rules that set the payment eligibility guidelines for US citizens who live abroad and non-US citizens who work in the US — along with spouses of nonresident aliens. We have a guide that walks you through the various eligibility scenarios along with what to do if you qualify but didn’t get a check. (And here’s how your status might change in a third check for mixed-status families.)
People who are in jail aren’t excluded from receiving a stimulus payment. Here’s why
Since April, when it first started sending payments, the IRS has gone back and forth on whether those who are in US jails and prisons qualify for a stimulus check.
A ruling last fall by a federal judge in California, however, seemed to have settled the question for now and required the IRS to contact those incarcerated and let them know they can file a claim for a stimulus check. The deadline to file a claim in 2020 — either through the mail or online — has passed. As with others who are missing a payment, the IRS said if you didn’t receive a payment by Dec. 31, 2020, you may be able to claim it this year by filing a 2020 Form 1040 or 1040-SR.
For everything to know about the first stimulus payment, see our guide to the first round of checks. We also have an idea of how much money you could get in the next stimulus check, the current status of a third stimulus payment and all the benefits the next stimulus package could bring.