2021 Recovery Rebate

[ilya555]

Our family received a lowered third economic stimulus payment because our 2020 AGI was $158K. However, we filed a 1040-X after that which lowered our AGI to $152K. This would make us eligible for more of the third stimulus payment. I was planning to put these numbers in on the 2021 Recovery Rebate worksheet but on the worksheet it is using by 2021 AGI from my 2021 Form 1040 to do the calculations, which makes no sense. It should be asking for the 2020 AGI to do the proper calculation. Is this a mistake on the worksheet? If so, how do I get that fixed as it won't let me override the numbers from Form 1040. If it's not a worksheet mistake, am I misunderstanding how the Recovery Rebate is to work? Based on IRS info I thought it was intended for people who received a lower rebate than they were otherwise entitled to because the IRS wasn't using up-to-date AGI info for the calculation.

[ilya555]

Some further info here. It seems that the 2021 Recovery Rebate is indeed intentionally based on 2021 AGI. This is because the third stimulus payment was considered an advance payment for 2021 taxes. While this makes sense, it defies some logic because in reality the payments were 100% based on 2019 or 2020 tax returns when issued. So it seems that basically if you're in the unusual situation I find myself in, there is no recourse because the recovery rebate is based on the principal that you situation got worse in 2021 and hence you should get more stimulus, not that the government needs to count your amended 2020 return but IGNORE your 2021 return. Seems a little ridiculous that because I filed an amended return 12 days after receiving the third stimulus payment, I have no way to have the IRS use that amended AGI to recalculate the thing they calculated two weeks earlier.

[VolvoGirl]

Right.  But if you got some 3rd stimulus based on 2020 or 2019 you don't have to pay any back if you don't qualify on 2021.