It is pretty common news now that the IRS has missed paying millions of people their $1200/$2400 economic stimulus payment and especially the $500 child stimulus payment. Many of these reasons are well documented and range from lack of staff availability to major system issues. The solution to address these missing payments, per the IRS, is for those impacted to claim the missing or underpayments in their 2020 tax return, filed in 2021. The IRS has already stated that they are unable to correct or issue additional payments in 2020 and if you did not receive the full amount to which you believe you are entitled, you will be able to claim the additional amount when you file next year.
Claiming Missing or Underpayments Stimulus Checks in your 2020 Return
The IRS has sent notice 1444, Your Economic Impact Payment, to eligible recipients (per their system records) that outlines their Economic Stimulus Payment details. You will need this notice when filing your 2020 tax return next year to claim any missing stimulus payments you were eligible for – which will be considered an additional tax credit.
Do I Need to Pay Taxes on my Stimulus Check Payments?
Per the IRS, NO. The payment is essentially an advanced refundable tax credit so is not part of a tax payers gross income. Therefore it is not taxable and no income tax is due on this payment in 2021, when you file your 2020 tax return. If you are entitled to other credits and/or refund payments, this stimulus/economic impact payment won’t reduce your refund or increase the amount you owe either.
The stimulus check payment will not affect your income for purposes of determining eligibility for federal government assistance or benefit programs. However the IRS will reduce the stimulus payment to offset past-due child support
Children born or adopted in 2020 or Change in Dependent status
You will also need to claim the $500 kiddie stimulus payment via your 2020 tax return if you had or adopted a child in 2020 or there was a change in dependent status since your latest IRS tax filing. All eligibility criteria still need to be met when claiming this. Also if your qualified child is only turning 17 this year you can still claim them.
The IRS will post additional guidelines on claiming your missing stimulus check payments in your 2020 tax return and I will post updates when available. I encourage you to subscribe below to get the latest updates.
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