Stimulus credit

[EB28]

I am about to finish completing our taxes for 2020 (joint filing). Our income in 2019 was above $150,000, so we did not qualify for any stimulus money. Our 2020 income is below $150,000.  Turbotax is giving us a $3600 tax credit (2*$1200 + 2*600 = $3600). I like it, but is this correct, considering stimulus decisions were based on the 2019 tax returns? Thanks.

[Critter-3 · Accepted solution]

Ok ... BOTH stimulus checks were advances of the 2020 credit  sent out using the 2018 or 2019 info the IRS had on hand.   The payments are now  reconciled on the 2020 return  using the 2020 info to compute the 2020 credit  so it is very possible you could be eligible for the credit now even if you were not in the past.  Enjoy.  

[EB28]

Thank you for your reply. I wonder if anyone else second your interpretation! That would make me feel more confident. Best.

[Bru2th]

I am in the same situation.  The only reason my income was significantly less in 2020 was because I was not required to take my RMD on retirement accounts.  I am hesitant to take the $3600 credit even though TT is saying I qualify.  I thought the first stimulus was based on 2019 income, not 2020 actual income.  Maybe that's where the confusion lies.  It may actually be the 2020 income, but I have never seen that stated.

[Critter-3]

If your 2020 income now qualifies you for the credit then you get it ... don't look a gift horse in the mouth.  There will be a lot of folks in both camps that will either get or not get the credit due to an income change from 2018/2019 to 2020  and will catch folks off guard.  But this is how the rules were written and the TT program follows them correctly. 

Here from the IRS:  https://www.irs.gov/newsroom/recovery-rebate-credit-topic-b-eligibility

[Bru2th]

Thanks.  You are entirely correct.  I'll take the tax credit and not complain, but there should be a better way to distribute the money to those who really need it.  My income only decreased because I didn't have to take my RMD in 2020.