IRS Notice CP11 says I owe Recovery Rebate Credit (RRC) Back!

[NCperson]

@Monty3 - I don't see where you posted previously.... here is the issue. You are only entitled to either the stimulus or the Recovery Credit - not both.

TT calculated the Recovery Credit you were eligible for, but the one input that TT required YOU to enter was how much you already recived for the 3rd Stimulus.  And the IRS knows how much you received because they are the ones that sent it to you.

So if it is just the two of you, you are entitled to $2800 in Receovery Credit, but if as you state you recieved $2800 last year, then you are not entitled to anything more, and Line 30 of Form 1040 is zero.

but when prompted by TT to enter what you had received, you only entered $1400, then TT thought you were owed another $1400 and placed that amount on Line 30.  When the IRS reviewed your tax return, they could tell you stated you only receivef $1400, but the IRS knows they sent you $2800.  Hence the IRS removed the $1400 credit from Line 30 and reduced your refund (or increased what you owed).

suggestion: do nothing until you receive a letter from the IRS that they have adjusted your tax return.  Then follow their instructions if you owe.  If you are due a refund they will reduce the refund and there is nothing else for you to do. 

[jennyebean]

On ours, I've logged into the IRS and saved screenshots of what THEY show they sent us. It's never changed.
We qualified for $5600, received $4200 (per total log in's under hubs and I both, combined), which means we should have qualified for the additional $1400 as a credit on our 2021 tax return.

That's what we entered.

Now the IRS says we don't get that credit. 

I have tried calling for two weeks, have tried setting up an appt at our local IRS office but that phone # won't connect because of "high call volume" and so I guess I'm sending a letter that I dispute their finding that we DON'T qualify for that $1400 credit. 

I HATE sending things by mail. UGH. 

[VolvoGirl]

How much did you have on 1040 line 30?  Did you have a new baby or dependent in 2021?  So you are married with 2 dependents now?  4 x 1400 = 5600.   And your online accounts show 2100 for each of you (half of 4200)?

[NCperson]

@jennyebean - just to confirm

it's you, spouse and 2 dependents on your 2021 tax return? that is the $5600?

and you only received $4200 last spring. 

what was on Line 30 of your Form 1040????? 

when you state 'that is what we entered". do you mean you entered $4200 into TT or you entered $1400 into TT?

[jennyebean]

Line 30 shows $1400. 

No new dependents- same 4 of us in the household that has been for 6+ years! 

And so I just logged back into our IRS accounts - they now show my husband got $3500 which is updated from previous. But I double checked all of our bank accounts and deposits, including all the Child Credit ones, and checks we deposited bc two of those came via check for some reason, and we only got $4200, plus the random Child Credit amounts. 
The TRANSCRIPT of our online account still only shows we received $4200 of the $5600, in one lump sum payment on 06/16/2021, because they attempted to deposit $2800 and $1400 in May 2021, but it got sent back to them.  So they corrected it all and redeposited the $4200 once in June 2021, which matches with all bank statements. But when Hubs logs in now to the Stimulus section, it's showing he got $3500 and I got $2100, which isn't right. 

RAWRRRRRRRR! I just want this to be fixed :( 

[VolvoGirl]

Yeah sounds like you need to contact the IRS to straighten it all out.  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...

[Critter-3]

A reduction in your refund for the recovery rebate credit is most often caused by user error---when you were asked how much you received for the third stimulus check -- the one for $1400 per person sent out from March to May last year----did you enter the total amount correctly?   Did you use the amount from BOTH spouse's letters 6475?   Or did you say you did not receive the full amount and thereby put an amount on line 30 of your Form 1040?  If you received the full amount already then your line 30 should have been blank.   There should only be an amount on line 30 if you did NOT receive all of the 3rd stimulus.

Try checking your online account with the IRS

https://www.irs.gov/payments/your-online-account

Does the IRS show that you received a $1400 per person stimulus or EIP check in 2021?   Did you receive it?   When you were asked on your tax return did you say no?   Was there $1400  per person on line 30 of your tax return?

If the IRS says you got $1400 last year but you did not receive it you can have it traced.

LOST THIRD STIMULUS CHECK

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

If you need to trace a payment that the IRS says has been issued to you, mail or fax a completed IRS Form 3911, Taxpayer Statement Regarding Refund.

[jennyebean]

Yep, it sounds like their two systems aren't matching up and showing the right amounts, since it's different in the two spots. 
I'll have Hubs do a trace on that extra $1400 on his side. 

[jennyebean]

Thanks @Critter-3  
I entered it all correctly on my part and answered the questions accurately, I double checked it all before I submitted because I did NOT want to end up with the wrong things showing lol

Seems like this issue isn't on my end but on the IRS side of not showing the right amounts sent to us. Super frustrating!

[Yelloweggbasket]

I also received a CP11 with five reason that they adjusted our recovery rebate.

1- a qualifying dependent entered an incomplete TIN - this is not true, we used our correct SSNs as we have for 30+ years

2- a qualifying dependent has a name that does not agree to their records - this is not true it is only my spouse and I who used the same names we have for 30+ years.  We listed no other dependents

3- a qualifying dependent is not qualified because of age?..- we did not list any dependents again. 
4 - adjusted gross income is over 150k for married filing joint, which it is not, as is shown on the CP11.

5- incorrectly computed 🤨

called the numbers for IRS snd basically get no where except told to call another day and hung up on.

going to send a express mail package with a printout of our turbo tax return with the line items they have listed in error highlighted, along with the Cp11. We did not get payments in 2021 because they based it on pre retirement 2019 or 2020 tax returns.  We made under 150 in 2021 so should be eligible for the entire 2,800 credit on line 30.  They reduced it to 1300. Told us we owe $1,500 more, looks like they changed our filing status, very odd.

wondering if these notices are generated by a computer program or a human, who maybe did not have a good day?

[NCperson]

@Yelloweggbasket 

before you go through that trouble, let's revisit: 

what happened in 2019 / 2020 doesn't matter. (I think what you are saying is that in 2019/ 2020 your income exceeded $160,000 so you don't beleive you were eligible for the stimulus)

what matters is 1) the number of people listed on your 2021 tax return Times $1400 LESS what you received in March-May, 2021

Are you saying that there is $2800 on Line 30 and the IRS reduced that by $1500?  That suggests either a) you indeed received $1500 in March - May, 2021 or b) your 2021AGI is between $150,000 and $160,000 (but TT should have automatically figured this out, so less likely)

suggestions:

1) go back and check your March - May, 2021 bank account statements to see if there is a deposit for $1500. (that also suggests your 2020 or 2019 AGI was between $150,000 and $160,000)

2) check your transcript on IRS.GOV and see if there is a credit for $1500 - that may give you a clue on when the phanton deposit occured.  Or if there is no $1500 phanton deposit, the issue is elsewhere (and I am totally off base)

3) if a deposit is listed, then you'll need to complete and mail in this tracer form

https://www.irs.gov/pub/irs-pdf/f3911.pdf

I would just hate for you to send in all the paperwork and then find out in 6-12 months (when the backlogged IRS finally reads it) that you need to follow a different tackt / process.

what do you mean they changed your filing status????????

[NCperson]

@Yelloweggbasket 

while most think they are ineligible for the stimulus once their AGI exceeds $150,000 what is really true is 

that once your AGI exceeds $150,000 you are not eligible for the FULL $1400 stimulus. 

There is a phase out between $150,000 and $160,000 so that what is true is that over $160,000 of AGI you are not eligigle for any 3rd stimulus.

[Yelloweggbasket]

There are only two of us filing married joint.  We did not receive any payments in 2021.  We received nothing and I already verified that when preparing my return.  I would have noticed that during the year anyway…

1400 x 2 = 2800 

so why else would they have reduced it unless they are considering one of us head of household or single and disallowing the other one based on the supposed bad dependent information?

does not make any sense.

[NCperson]

@Yelloweggbasket

again, suggest checking your transcript on IRS.GOV.  check what the filing status is. check to see if they sent out $1500.  it is possible that they send it out and your didn't receive it (e.g. lost in the mail for whatever reason - it happens- hence the tracer form)

if they changed the filing status then the taxes due would probably be way different than using the 'joint' tax rates (unless your retirement income is now so low, you didn't owe any taxes under either filing status, which does occur)

what is the EXACT reduction in the refund? 

I'm just suggesting more fact checking in the transcript before you send off a bunch of papers, wait 9 months and then find out the issue is elsewhere. 

[Yelloweggbasket]

I have no issue with the reduced amounts we received for 2019 or 2021.

I have a problem with the irs saying we have bad qualifying dependent information, which my return clearly shows we don’t, and apparently disallowing the full amount based on that bad information.

we did not get any payment in 2021, unless someone has fraudulently obtained one using our information.  That would be a pita…..

it is not an easy process to get into your account at IRS, got the id me verified and it gives me an error 2004 on the irs web page.