Notice CP12 - Recovery Rebate Credit

[Florida_Wolverine]

If your AGI is greater than $150,000 but less than $160,000 for married filing jointly do you still potentially qualify for the Recovery Rebate Credit? I received a vaguely worded letter from the IRS and they list multiple reasons they may have rejected. One reason states your AGI exceeds $150K (married filing jointly) but when I reviewed the worksheet from Turbo Tax it has a convoluted formula for computing the potential refund if you're between $150K and $160K. I have not been able to reach the IRS but an trying to determine if I'm spinning my wheels.

[VolvoGirl · Accepted solution]

Those are just generic reasons why they adjusted the Recovery Rebate Credit on your return. A common adjustment is if you claimed the Recovery Rebate Credit on 1040 line 30 when you already got the 3rd Stimulus payment or reported the wrong amounts. Do you have an amount on line 30? The IRS knows they already sent it to you. Line 30 is only if you didn't get the full amount or qualify for more.  Did you get letter 6475 telling  you how much they sent  you?  Each spouse gets a letter for half.  So you may have only entered half the amount instead of the total you received.

How much is missing? Check 1040 line 30. A common reason this year is if you tried to claim the Recovery Rebate Credit (for the 3rd Stimulus 1,400 per person) when the IRS already sent it to you. Line 30 is only if you didn't get the full amount or qualify for more. Not the amount you already got.

They sent the 3rd Stimulus payment (1400 per person) starting in March 2021. Double check your bank statements and check your IRS account (both accounts if married) to see what they sent you.
https://www.irs.gov/payments/your-online-account

[NCperson]

@Florida_Wolverine -

the $150k-$160k rule kicks in based on Line 11 of Form 1040.

But that is unlikely to be the issue..putting that issue aside (and we can come back to it if you are truly in that income range), the formula is quite simple:

1) $1400 times the number of people listed on your tax return LESS 2) what you already received.

Go back to your bank accounts from Last March - May, 2021 to determine what you actually received.  DO NOT DO FROM MEMORY.

1)-2) is what should be on Line 30 of form 1040. if you told Turbo Tax that what you received is LOWER than what you actually received after reviewing your bank account, then Line 30 is inflated and the IRS adjusted it. That adjustment lowers your refund (or increases what you owe)