My Adjusted Gross Income (AGI) was below $150K (married filed jointly) and still received an IRA Notice CP11 saying that I owe the RRC back ($1,400)! The notice even confirms my AGI as <$150K which matched Turbo Tax (TT) amount! I tried to call the IRS 800 number several times but due to call volume they tell you to call back later. I'll send a letter instead.
Is this a common issue that others have experienced?
Check your bank account for March-April 2021 to see if you already received that credit.
Clairification...You owe it back as in you received it prior to filing your tax return and they are saying you are not eligible for it or you owe it back because you claimed it on your tax return and they sent it to you? The second seems less likely as the IRS was making adjustments to returns before sending the recovery rebate to people who already received them.
What exactly does the letter say the reason is you have to repay it is?
Yes, issues with the Recovery Rebate this year are common, however, having to pay it back hasn't been a common problem, most people are having their refunds recalculated to remove it when they have already received it but said they didn't.
We just received the same letter & I can’t figure out the error. Was yours resolved?
I tried calling the IRA but they are so busy you can not even leave a message, so, I sent a letter with Turbotax return attached showing that we were under the $150K limit and should be able to take full credit for the Recovery Rebate Credit (RRC) of $1,400. To date, I have not heard back from the IRS and will send tax I/Turbotax say is owed by 4/17/2022. This may be a mistake on my part since since normal practice is to send them what they ask for and then petition them for a correction/rebate later, but I'm confident that the mistake is on their end. I'm assuming that thousands of people received the same letter and may just give back the $1,400 RRC without question!
Check your IRS Account - you will probably find that they sent the check last year. If you have been filing tax returns for several years and your AGI is not high enough to disqualify you, it is very unlikely that you did not receive the payment. It is likely that you did not know you received it, but very unlikely that they did not send it.
For the first and second stimulus payment - your eligibility depends on your 2020 AGI number
For the 3rd payment, your eligibility depends on your 2021 AGI number.
It is possible to qualify for the first and 2nd payment, but not the 3rd. It is also possible to qualify for the 3rd, but not the first two.
Access Tax Records (use this link)
The IRS letter states five reasons for why they say I owe more money. Three of the reasons have to do with claiming dependents (not applicable to me), one for AGI over $150K and the last for "computed incorrectly". If either of the last two are the issue, then Turbotax made the mistake and the error is in the their program. I, like everyone else, received IRS letter 6475 stating amount of Economic Impact Payment we received and that this amount must be part of your 2021 tax return to receive the RRC credit, which I did.
You have to reconcile the amount you got on your tax return. The Recovery Rebate credit on 1040 line 30 is only if you didn't get the full amount or qualify for more. Do you have an amount on line 30? You tried to claim it twice. But you already got it. Line 30 should be blank.
And if you are married you should each get letter 6475 for half. Did you enter the total amount you received on the Stimulus page?
This happened to me too and it turns out that Turbo Tax was unclean in determining this credit. I ended up having to pay it back, which is fine, but now I am trying to figure out where/how to include the repayment on my 2021 tax return. Anyone else have this issue?
You don't include the repayment on your return. Or are you trying to make your 2021 return the same as the IRS adjusted? Don't worry about that.
Got it figured out today with help from a Turbo Tax rep. I do owe $1,400 more on my return due to how I answered one of Turbo Tax's questions regarding stimulus payment. When doing my taxes Turbo Tax noted that my wife and I did receive a total of $2,800, but then asked the question if this amount matched the IRS Letter 6475? I answered NO because I had received only one letter from the IRS and it showed $1,400 only (I was confused why the letter didn't show $2,800?). By answering NO that added a Recovery Rebate Credit of $1,400 to 1040-SR, Line 30. I had no idea that the IRS was sending out separate letters even if you filed married joint (did finally receive the other letter but after the fact) and they sent me the money in one lump sum so I assumed it was handled jointly? Anyway this added to my confusion which lead me to incorrectly answer NO. It would have helped (me) if Turbo Tax would have asked the question differently or explained that the IRS was "treating" the stimulus payments individually. Hope this helps anyone else that might have been confused like me
You are one of few people who actually got an incorrect Recovery Rebate from the IRS.
And then had to pay it back.
That is so rare I've never seen it reported before on this forum.
You're probably misreading your notice from IRS.
Let me be clear the mistake is on me for how I answered the question in Turbo Tax. I'm not eligible for a credit since we (my wife and I) received our stimulus money. I was simply confused on how the question was asked since I only had one 6475 letter in hand (the other letter came after I filed). My point was maybe Turbo Tax could have had a little more info related to how they asked the question, that's all
why im i getting a notice after i have filed my taxes stating i owe 1,143 for recovery rebate credit and none of the items specified appied to me what do i do
@scconne1 The screen asks for letter(s).....and has more info
That is the list of generic reasons they give if they changed the Recovery rebate credit on line 30. How much is on 1040 line 30?
Did you not get the 3rd Stimulus payment? Or qualify for more? Line 30 is only if you didn't get the full amount or qualify for more. The IRS shows they already sent it to you.
Double check your bank statements and Check your IRS account (both accounts if married)
I also received a CP11 saying that I calculated my tax wrong and that I owe an additional $898, which is EXACTLY the amount calculated by TurboTax on the Recovery Rebate Credit Worksheet. Essentially, the IRS notice seems to be saying that I'm not entitled to that credit. I have reread that worksheet about a hundred times now, and as I see it, we (married filing jointly with and AGI below 150K) should be entitled to $2800, but back in March 2021, we received $1902. I am also unable to get through to the number provided in the letter. I also contacted TurboTax, but unlike in prior years, where someone was able to advise me on it, I am being told that I need to talk to the IRS or a CPA. Is that the same?
I also assume that the average person just says "oh, no, I need to pay more" and does, but I am also convinced that, as long as TurboTax calculated it right, I don't owe what they say I do. Hang in there.
When the IRS backlog eases up in six months or so, you will be able to contact someone at IRS who can explain to you what happened.
Have you checked to see if the IRS thinks you or your spouse already got the money? If so, you need to trace it.
First, determine if you received one at Third Economic Impact Payment. Check your bank records and verify you did not receive it already.
If the IRS thinks you got it and you are you did not, then you will need to request a payment trace, call 800-919-9835 or fill out IRS Form 3911, Taxpayer Statement Regarding Refund.
@WisMom22
The CP11 notice is very specific that we need to respond by June 17 or we lose any chance of arguing that their higher amount is wrong, and we will owe that amount even if it's incorrect. The notice also states that connecting by phone is preferred over sending a letter. The letter also states that the payment needs to be made by May 9 or it will be subject to interest. So 6 months isn't an option!
AmyC,
If you are replying to me (WisMom22,) we did receive a third economic impact payment of $1902. I have verified that in our bank account. The $898 that the CP11 letter says we owe is the difference between the $2800 full payment (which the IRS worksheet calculates we are entitled to based on our AGI) and the amount we actually received. I can't find any reason why the IRS would think we are only entitled to $1902, nor do I find any indication that they believe we received $2800, which we did not. I will keep trying to contact them, and if I can't soon, I will mail them a letter. I wish that TurboTax would talk me through this to affirm whether the software has filled in and calculated the worksheet info correctly.
To my way of thinking turbo tax dropped the ball on this and should refund my upgrade charge. The wording was very unclear and I am on SS and wtf, the government gives me a check then takes it back with taxes?
Why do you take full responsibility for this? Judging by how often this occurred to so many people I think you are far too forgiving.
Well first, I don't know if this happened to anyone else so I can't make that claim. Second, the Turbo Tax person I spoke with was very sympathetic to my situation and did agree to mention this to her supervisor to maybe avoid future questions like this one. Bottom line, I'm responsible for making sure I do my taxes on-time and correctly, so when I saw the $1,400 credit on line 30 I should have questioned why that was and investigated it. I send the correct amount in to the IRS which is always a good thing to do...