2020 Tax Return Stimulus Reporting Problem

[cclarkwa]

I have 2020 Turbotax deluxe. I've used Turbotax for many years.  I found a problem with the software which the phone-in support people for the Deluxe version could not address.  They said I would need to upgrade to the Premier version ($30 more).  The problem I found was that the stimulus amount Turbotax showed I was entitled to is much more than I was entitled to.  I did get a reduced stimulus payment which was based on my 2018 return.  This was allowed by the IRS.  If I used my 2019 return I would not been qualified for any stimulus.  Turbotax asked the question did I receive these amounts. Option was to select "Yes" or "No". To be correct I need to answer "No" which results in a substantial credit on my return.  If I were to answer "Yes" the return would be correct  refund wise but I'm concerned that this my cause an issue with the IRS.   To me there should be a question if the stimulus amount shown is what you are entitled to - "Yes" or "No" (then with some explanation of the qualifying criteria).  I have purchased the upgrade since I think this is an important issue that should be corrected.  Maybe I'm wrong?

[ErnieS0]

You do not need to upgrade to Premier for stimulus payments.

For you return to be correct, enter the actual payment amounts you received last year. If you qualify for a full stimulus based on your 2020 tax information, then you are entitled to the difference. The IRS sent out the payments. They have a record of what they gave you.

The stimulus payments were advanced payments for 2020. Your correct stimulus amount is based on your actual 2020 income, not your 2018 or 2019 income.

The IRS did not have 2020 information when it sent out payments, so the Service used 2018 and 2019 tax information with the understanding that your payments would be trued up on your 2020 return.

In your case, it sounds like the IRS used your 2018 tax return information to send out your payments because it did not have your 2019 info. If your 2020 income put you under the full stimulus thresholds then you are entitled to the difference.

[kchaley6]

removed comment.  I reversed EIP1 and EIP2 in the form which made it calculate incorrectly.

[cclarkwa]

Thanks for you reply.  I see there is another Turbotax user with the same issue.  Let me be more clear about my cercumtances:

I file as a married person filing jointly.  When the government made stimulus payments available in early 2019 it was before 2019 tax returns were due and in fact the due date was extended.  The IRS would make stimulus payments based on 2019 tax returns or 2018 tax returns if the 2019 tax return had not been filed.  Since I knew that my 2019 return would show an income exceeding the max income for stimulus payment I decided to let the stimulus be based on my 2018 return which was completely legal.  I received a stimulus of $1982.95 on April 15, 2020.  At that time there was no plan for a stimulus payment based on 2020 returns.  I don't understand how the 2020 return can be used to determine as a credit overriding the reported income for 2018 and 2019.  To further confuse things I don't think the procedure and amount of the 2020 stimulus has been determined.

Like the other user I don't want to do something that will greatly delay my refund by the IRS.

Thanks

[KrisD15 · Accepted solution]

You may be reading more into this that you should. 

The stimulus was/is based on tax year 2020, however only additional stimulus (payments not received)  will be credited on the 2020 tax year return, NO ONE IS REQUIRED TO PAY BACK STIMULUS THEY RECEIVED THAT IS OVER WHAT THEY SHOULD HAVE RECEIVED. 

When you use TurboTax, please enter the total amount of stimulus payments you have received. If you are entitled to more, that will be credited on line 30. 

[mojoes12]

Cant find where to report stimulis on my premier program

[VolvoGirl]

When you go through the federal review tab it will ask how much you got if any.  Enter a 0 in the box if you didn't get one.  Or to enter your stimulus payment in TurboTax, type "stimulus" (without the quotes) in the Search box, then click the link that says "Jump to stimulus."

After you have entered your tax information and are ready for the Federal Review, it will be the first question.

If you are trying to trigger it, you can go to Other Situations, answer any questions and click Done. The next automatic selection is Federal Review and it will ask about payments received.

The Recovery rebate credit is on 1040 line 30.  It either adds to your refund or reduced a tax due.

[Jking165]

We received less then the full amount stimulus check last year because we made over $150,000 AGI in 2019.  In 2020 we made less then $150,000 AGI so when we used turbo tax and entered this information we were to receive the remaining money to make last years stimulus checks complete in our 2020 tax refund.    I finally just got our tax refund and the IRS deducted the remaining stimulus money owed us.  

[pfanneda]

It's not reading more into it. The program's verbiage is poor to failing. It ask: if those are the payment received... displaying the amounts as calculated. The program indicates that is what the person should have received, and verifying with a yes/no. If yes, is selected it then assumes no stimulus payments were received. Although the original indication is to verify the stimulus payments received. (Clearly a very poor way to ask/confirm information..)

[wall2]

On June 14, 2021 the IRS sent me a letter that they thought explained why they reduced my 2020 return from $ 5594, as computed by Turbo Tax to $ 3608.50. I sent the paperwork to Taxaudit and the advisor said that the IRS corrected my return to make the reduced return amount correct. When Turbo tax asked me if I had received the $2400 stimulus payment I said yes, and I anticipated that the return would be correct. I see Line 30 rebate $2400 and then Line 32 titled refundable credits is also $2400. If the stimulus payment does not have to be paid back, why did the IRS deduct that amount from what TurboTax had computed? Was a mistake made that required me to "lose" the difference between what TurboTax said my refund would be and what the IRS sent me?

Walter Armistead

[phone number removed], [email address removed]

[VolvoGirl]

If you already got the first and second Stimulus payments then line 30 should have been zero.  Line 30 is only if you qualified for More.  Don't know how you answered the Stimulus questions wrong.  Maybe you entered the wrong amount in the wrong box.