IS STIMULUS BASED ON 2020 OR 2019 TAXES
Is stimulus based on 2020 or 2019 taxes. What if you made more money in 2020, but the check is based on your 2019 taxes ? Taxpayers receiving an advance payment that exceeds their maximum eligible credit based on 2021 tax return information will not be required to repay any amount of the payment to the Treasury. If a taxpayer’s 2021 tax credit exceeds the amount of the advance payment, taxpayers can claim the difference on their 2021 tax return. Therefore, if you qualify for the full $1400 based on your 2020 taxes, but the IRS issued your check based on your 2019 taxes, you could claim the difference a year from now on your 2021 tax return–much like the current Recovery Rebate Credit for missing stimulus money from the first two rounds. Is stimulus based on 2020 or 2019 taxes.
On the other hand, this also means that if you are eligible to get the entire payment based upon your 2019 income amount, but do not qualify based on your 2020 taxes, and if the IRS used your 2019 return, you won’t have to pay the IRS back for that discrepancy. Will the IRS based your third stimulus check on your 2019 or 2020 taxes ? The most recent democratic proposal states that the IRS will determine the total third payment based on the adjusted gross income from either your 2020 or 2019 tax returns—whichever the IRS has most recently on file at the time of payment. There may be several implications to this. If you earned more in 2020 than in 2019, but the IRS uses your 2019 return (and gives you more stimulus money than you might be eligible for) you won’t have to return that money.
The IRS is now accepting the 2020 tax returns, as tax season is again upon us. Tax Resolution is available to help those who need to file returns to be eligible for a stimulus check. You should file your tax returns right away. The earlier you file, the sooner you end up getting a tax refund and any missing stimulus money you may be due.