Stimulus Affect on Projected Refund/Payment Amount

Forum|Forum|5 years ago
February 3, 2021
8 replies
29 views

All documentation indicates that stimulus payments will not be taxed or "affect your refund amount". However, any number entered into this field (Stimulus Amount 1; Amount 2) proportionally affects my refund in the exact amount as entered. Is this based on AGI? Is it correct? I feel like I'm being penalized for receiving these payments.

DMarkM1

Level 15

Once you entered an amount in one of the stimulus boxes, your return was automatically updated to include the Recovery Rebate Credit based on the information in your return.

Any subsequent entries or changes in the stimulus boxes adjusts the Recovery Rebate Credit and therefore your refund accordingly.

You can test this out by entering that you received stimulus amounts above what you are eligible for. The reduction maximum will be only your credit maximum no matter how much stimulus you add on top of that.

To remind you here are the eligibility amounts:

Round one: $1200 (2400 if filed jointly) plus $500 per dependent child age 16 or younger

Round two: $600 (1200 if filed jointly) plus $600 per dependent child age 16 or younger

Here is a link with more information on the Recovery Rebate Credit.

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jfx1963Author

Level 2

I think you missed the point. And the name it's referred as: "Recovery Rebate Credit", has nothing to do with the end results.

I realize that the amount entered affects the refund. However, it has been widely stated and advised that stimulus checks will NOT affect your refund amount. But that's exactly what is happening. The stimulus entries are reducing my refund by exactly what the checks values were. With this, it's as if the checks I received came out of my pocket and NOT the governments.

Are we being scammed with this "Stimulus" disguised as a "Recovery Rebate Credit"? Or is TurboTax programming off?

jfx1963Author

Level 2

Perhaps this wording from the IRS page that was linked, implies that the question posed by TurboTax should NOT be included, since answering it truthfully will result in negative penalties.

"Individuals who received the full amounts of both Economic Impact Payments do not need to complete any information about the Recovery Rebate Credit on their 2020 tax returns. They already received the full amount of the Recovery Rebate Credit as Economic Impact Payments."

Steven_Dauble

Level 2

Why does TurboTax reduce my refund by the amount of both stimulus checks?

JamesG1

Level 15

Did you report the amount of the two stimulus payments on line 30 of your 2020 Federal 1040 tax return when you filed? Had you already received the first two stimulus payments? Please clarify.

If you had reported a Recovery Rebate Credit on line 30 of your 2020 Federal tax return for stimulus payments that you had already received, the IRS would have reduced your refund by the amount of the stimulus payments that you had already received.

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Critter-3

Level 15

Let me explain how stupid the placement of the stimulus question in the interview flow is …

Your 2020 return starts out by assuming you didn't get any Stimulus payment so it gives you the full amount of the credit and that is reflected in the Refund-O-Meter. Then near the end of the interview you enter how much you actually got in advance and the floating refund is adjusted accordingly so you don't get the credit twice.

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

Before filing, You can preview the 1040 or print the whole return

https://ttlc.intuit.com/community/accessing/help/how-do-i-preview-my-turbotax-online-return-before-f...