The federal government issued three rounds of stimulus checks during the COVID-19 pandemic to help people meet their financial needs. Although most people received their payment, some did not or received the wrong amount. If you are one of those, you can still receive the money, but you will need to claim the Recovery Rebate Credit. The IRS also recently issued a reminder to those who are entitled to the Recovery Rebate Credit to claim the money before the due date.
Who can claim the Recovery Rebate Credit?
The Recovery Rebate Credit is a refundable credit for those who did not receive one or more of the stimulus checks, officially called the Economic Impact Payments (EIP), issued in 2020 and 2021. Although most have already received the stimulus money, the IRS estimates that some eligible individuals and families haven’t yet received the money.
Such people, however, need to file a tax return first, even if they don’t qualify to file a return. The deadline to file a return to claim the 2020 credit is May 17, 2024, while for the 2021 credit it is April 15, 2025.
The deadlines are determined in this manner because the 2020 credit would have been claimed on the 2021 return, while the 2021 credit would have been claimed on the 2022 return. A taxpayer typically has three years from the due date to claim a refund. This means that those eligible for the stimulus check still have time to claim the Recovery Rebate Credit by filing their 2020 or 2021 return.
To claim the Recovery Rebate Credit for 2020 or 2021, a taxpayer must:
- Have been a U.S. resident or resident alien in 2020 or 2021.
- Not have been claimed as a dependent by another taxpayer for 2020 or 2021.
- Have a Social Security number, which was issued before the tax return due date.
Points to remember
It is important that those who didn’t receive the full amount of stimulus checks, including dependent payments, mention the amount they received, before any offsets, in their return.
Taxpayers must know that the Recovery Rebate Credit won’t be considered as income when determining their eligibility for federal benefits, such as SNAP (Supplemental Nutrition Assistance Program), SSA (Supplemental Security Income) and others.
Also, claiming the Recovery Rebate Credit won’t affect the taxpayers’ immigration status or eligibility for a green card or immigration benefits.
It must be noted that a person can claim the 2020 Recovery Rebate Credit for someone who died in 2020 or later, while the 2021 Recovery Rebate Credit can be claimed for someone who died in 2021 or later.
Taxpayers can file their returns electronically and receive the refund via direct deposit. The IRS says it takes about six weeks to process an accurate tax return. Those who need help in filing can use the free one-on-one tax preparation help nationwide through the Volunteer Income Tax Assistance, and Tax Counseling for the Elderly programs.
