IRS Accepted 2021 Return, Recovery Rebate Credit Issue, Adjusted Refund

[smwilliamson0923]

My AGI was $152,428.00. TurboTax guided me through the return and computed line 30 of my return (Recovery Rebate Credit) $4256.00...which honestly seems wrong to me on the face of it, that should have been $5600.00... but it was filed that way.

We never received any of the advanced payments, just the first two stimulus checks. IRS.gov says we qualified for $2800.00 for the third payment (1/2 of $5600) but that didn't show up on my account until late December.

Filed Feb. 4th, 2022; accepted on March 2, 2022. IRS made a correction to our Recovery Rebate Credit and deleted the whole $4256.00. We were are expecting a refund, said our payment would be in our bank account by March 14, 2022, but our total amount was reduced by the whole RRC.

I realize we made more than $150k but we made less than $160k.

from IRS.gov

No credit is allowed when AGI is at least the following amount:

• $160,000 if married and filing a joint return or if filing as a qualifying widow or widower
• Married taxpayers who file a joint return that claims two qualifying dependents and an AGI of $155,000 will have a maximum credit of $2,800

If I'm understanding this correctly, our Recovery Rebate should have been adjusted to $2800, not 0. Is this correct?

[KrisD15]

To clarify

Do you claim any dependents or is it only you and your spouse?

The 3rd stimulus was 1,400 each Taxpayer (and dependents), how are you figuring 5,600? 

"but that didn't show up on my account until late December."

What showed up in December? The FULL 2,800 third stimulus? 

What did you enter as what you received for the 3rd stimulus in the TurboTax program?  

[smwilliamson0923]

Sorry, yes we have two children, ages 14 and 16.....so $1400 x 4 = $5600.

In late December, 2021 on IRS.gov our tax file said that we were owed $2800 for the third stimulus. For most of 2021 it said "they were unable to tell whether or not we qualified"

I'm pretty sure that I entered 0 for the third stimulus though my line 30 said $4652.00

[DMarkM1]

Based on the IRS reference if your AGI was $155K and you filed a joint return with two dependents your maximum is $2800.  Of course if your AGI was higher- the credit would be lower and if AGI lower- higher credit. 

It definitely sounds like something around $2800 should have been included on your return. Since your account wasn't updated until late in the year there may be a payment being processed that you haven't received yet.  Therefore the IRS removed it from your return.    

Refer to question H10 in this IRS FAQ for your course of action, which is to contact the IRS.

[mchale85]

My 2021 AGI $150,594 on my 1040-SR.  Married no dependents.  The turbo tax 'Recovery Rebate Credit Worksheet' shows I qualify for a $362 Recovery Rebate Credit (line 14).  The table for Married on line 10 shows I qualify if AGI is below $160,000.  I just got a letter from the IRS saying I owe back the credit plus interest.  Why does the Turbo Tax worksheet show AGI below $160,000 but the IRS letter shows $150,000?  Please help

[Critter-3]

Did you get any or all of the third stimulus payment in advance ?   If so you cannot also get the credit on the return.   The phaseout for married was 150K to 160K  ... read the rules here :  

https://www.irs.gov/newsroom/questions-and-answers-about-the-third-round-economic-impact-payment

[VolvoGirl]

Better check and see if you already got the 3rd Stimulus payment.  The IRS thinks they already sent it to you.   Double check your bank statements and Check your IRS account (both accounts if married)

Your Online Account | Internal Revenue Service

The 3rd Stimulus payment started going out in March 2021 and is for 1,400 for each person listed on your tax return, no age limit. The IRS used your 2020 (or 2019) return to send the checks out fast. If your 2021 return changes and you qualify for more you can claim the extra as the Recovery Rebate Credit on 1040 line 30. But line 30 is only if you didn't get the full amount or qualify for more. Not the amount you already got. The IRS also sent out letter 6475 to tell you how much they sent you . If you are married then each spouse should get a letter for half.

[mchale85]

My wife and I got IRS letter 6475 in FEB 2022 stating each of us were getting $1,400 (a total of $2,800).  In March 2022 we did receive this 3rd stimulus, but it was only $2,270 sent from the IRS.   When I did my 2021 taxes, it showed a recovery credit amount of $362, less than the $2,800 - $2,270 which would have been a credit of $530.  Assuming this $530 maximum vs $362 phase-out was due to the calculation of the phase-out with our AGI at $150,594, but well below the $160,000.  Now the IRS wants the $362 back plus interest.  I do not understand why the IRS wants this amount if the phase-out shows a credit in Turbo Tax via the IRS recovery worksheet.    

[Critter-3]

Ok ... the IRS sent the original stimulus probably based off your 2019 return and then sent more later based off the 2020 return once you filed it ... so check your bank account ... did you ever get a "PLUS UP" payment between May & December ?   

As to the current issue ... pay up asap.   Then if you did not get the + up payment  you can have the IRS trace the payment ...

If you claimed a missing stimulus payment on your return but the IRS took it off you have to ask the IRS. They think they already sent it to you.  Maybe it went to an account you don't remember. Or you got a check or a card. It was probably easy to miss the debit card in the mail and think it was junk mail. They have to put a trace on it.

Double check your bank statements and Check your IRS account to see when and what they sent you (check both spouse's accounts if married)

Your Online Account | Internal Revenue Service

If the IRS thinks they sent it to you but you didn't get it request a trace for a missing third Stimulus payment

https://www.irs.gov/newsroom/questions-and-answers-about-the-third-economic-impact-payment-topic-j-p...Your Online Account | Internal Revenue Service

[NCperson]

@smwilliamson0923 - let's parse this down, because some things are not making sense 

My wife and I got IRS letter 6475 in FEB 2022 stating each of us were getting $1,400 (a total of $2,800). the letter in Feb, 2022 would not be stating what you were each 'getting', it would have stated what you actualled received  In March 2022 we did receive this 3rd stimulus the 3rd stimulus was sent out in March 2021, not 2022 - did you really receive this money a year later than everyone else? , but it was only $2,270 sent from the IRS.   When I did my 2021 taxes, it showed a recovery credit amount of $362, less than the $2,800 - $2,270 which would have been a credit of $530. not tracking on this  Assuming this $530 maximum vs $362 phase-out was due to the calculation of the phase-out with our AGI at $150,594, this was your AGI for which year? only the AGI for 2021 matters   but well below the $160,000.  Now the IRS wants the $362 back plus interest.  I do not understand why the IRS wants this amount if the phase-out shows a credit in Turbo Tax via the IRS recovery worksheet.  If you entered a numbrer into Turbo Tax that is less that what the IRS beleves it sent you, it is very possible that what was entered into TT is not correct.

If you have the Letters 6475 from March 2022 that state you received $1400 each, then that is what the IRS beleives it sent you.  That is where the problem begins.  If you beleive you were only sent $2,270, were there a 'plus up' for $530 along the way.  did you check your transcript???? Suggest doing that as a first step and see if you see $2270, $530 or $2800 sent to you