2021 relief money

[philip68]

My wife and I file married filing jointly. We got a 2021 economic impact payment (I am NOT talking about the child tax credit checks). Everything I have read says that is NOT taxable income and yet when I put the amount in I go from getting a federal refund to having to pay federal taxes... WHAT?

[xmasbaby0]

You owe tax for some other reason.   The stimulus money you received is not taxable.   Look over all of your other information and compare your 2020 return to your 2021 return to see what else is different.  Make sure you entered your 2021 income correctly and that you entered the tax withheld amounts from your W-2's correctly.  It is possible that you simply did not pay enough tax from your income during the year and owe now.

[LoganathanB]

Yes, the stimulus is not taxable.

When you started the return recovery rebate credit (eligible third stimulus) was added to your refund assuming that you did not get it.

When you answer the question whether you received the stimulus YES

then the recovery rebate credit becomes 0 and your refund is automatically reduced.

Recovery Rebate Credit