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Level 2

What is the basis for the refund for 2021 Stimulus check that was less than the maximum?

IRS sent me a letter stating the additional refund credit shown in my return is wrong and wants the funds back. Is the Stimulus check for 2021 (third stimulus check issued in March 2021) based on the tax year 2019, 2020 or 2021 Gross  Income? 

2 Replies
Level 15

What is the basis for the refund for 2021 Stimulus check that was less than the maximum?

The 3rd EIP is based on your 2021 income.    When they sent out those payments they were in a hurry so they could have used an earlier year tax return ---- if your income was lower in that earlier year you do not have to pay any of it back.   But if you are getting the 3rd EIP as a recovery rebate credit on your 2021 tax return, only your 2021 income is considered.  If your income is above the limit, then you may receive a "phased out" amount, or no credit at all.


LOTS of people have made mistakes this year with the recovery rebate credit by "forgetting" that they received the $1400 per person stimulus checks last year.  They answered no to the questions for the  recovery recovery rebate credit and put the $1400 per person on line 30 of their returns.  But you cannot get it twice, so the IRS removes it when it is there by mistake.  The IRS sent letter 6475 showing that you received the 3rd stimulus check. 



It is very important that if you filed a joint return—-the IRS sent letter 6475 to EACH spouse.  You had to enter the total amount received.   Many people misunderstood and entered only the amount from one of the letters.



Try checking your online account with the IRS (and if you filed a joint return—check for BOTH of you)


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  per person last year but you did not receive it you can have it traced.



**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**
Level 15

What is the basis for the refund for 2021 Stimulus check that was less than the maximum?

@Sunbaltax - let's go back and review how this worked:


it doesn't matter how the 3rd stimulus was calculated to determine whether you are due any more.  it is cash you received is all that matters.  What matters is how the Recovery Rebate Credit is calculated.


your Recovery Rebate Credit (line 30) is calculated by taking $1400 times the number of people listed on your tax return LESS what you received for the 3rd stimulus, but the result can not be less than zero.  (a little more complicated if your income was over $150,000 - joint, $75,000 - single, but I'll come back to that if you state you are in that income bracket on another post)


please answer these questions and I can further clear up any misunderstanding:


1) what is on Line 30 of your 2021 tax return?

2) how many people listed on your tax return

3) how much did you receive for the 3rd stimulus - please review your bank account records from March- May, 2021. DO NOT GO FROM MEMORY as this is where most make the mistake - what was actually deposited in their bank account doesn't match their memory!!)

4) how much was the IRS adjustment? 


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