How is third stimulus payment credit determined?

[jtaxuser]

How is third stimulus payment credit determined?  I did not get a 3rd stimulus payment in 2021 tax year.  As I recall, I had already filed my 2020 return before the 3rd stimulus.  At the time, the 2020 return put me over the threshold for getting the 3rd stimulus check which is why I attributed not getting one. I recall this being announced at the time.  Is the determination of the 3rd stimulus not based on your 2020 federal tax return?

[DanaB27]

Yes, the payment of the third stimulus was determined by the last filed tax return but the Recovery Rebate Credit for the third stimulus payment is based on the 2021 tax return. Therefore, you might qualify to get the Recovery Rebate Credit if your income got reduced in 2021.

To claim the Recovery Rebate Credit in TurboTax, please follow these steps:

1. After entering all your information click "Search" at the top right and type "Stimulus".
2.  Follow the jump to link (if you do not qualify for the Recovery Rebate Credit the stimulus questions will not come up). 
3. On the screen "Let's double-check the amount you received" you will be asked about the amount of third stimulus payment you received. TurboTax will then calculate the amount of stimulus payment remaining that you are still entitled to get. 
4. Any stimulus amount remaining due to you will show as The Recovery Rebate Credit on line 30 of Form 1040.

To be eligible for the Recovery Rebate Credit you need to be a U.S. citizen or U.S. resident alien in 2021 and have a Social Security number that is valid for employment.

You cannot be claimed as a dependent by someone else to be eligible. 

Your credit amount will be reduced if your 2021 adjusted gross income (AGI) is more than: 

• $150,000 if married and filing a joint return or filing as a qualifying widow or widower
• $112,500 if filing as head of household or
• $75,000 for eligible individuals filing as a single or as married filing separately.  

Your payment will be reduced by 5% of the amount by which your AGI exceeds the applicable threshold above. (IRS FAQ Recovery Rebate Credit ).

Please see What are the eligibility rules for the Recovery Rebate Credit? for additional information.

[jtaxuser]

Thank you for the reply and answer.  Very helpful.  TurboTax asked if I got a 3rd stimulus check in which I input no.  It started calculating the stimulus amount and refund based on the response and AGI.   In my case the 3rd stimulus check amount would be zero ($0) as I did not get one.