1040X - IRS asking for additional documentation

[sayarbai]

Greetings All, 

I have a turbotax premier product for tax year 2020. I prepared my 2020 returns (original and amendment) using Turbo premier software. I was unable to file the 1040X online and so I took a print out straight off Turbo and sent 1040X for 2020 to IRS. IRS has written back to me that they need additional documentation.  The two reasons I filed an amendment:

1. I claimed less CTC for my daughter by a mistake (regular Child tax credit and NOT additional). I incorrectly claimed $500 instead of $2000

2. The Economic stimulus I received for year 2020 was less than what  turbo calculated thro 1040X. ( I received $1,800 for a family of three, whereas turbo calculated that I should have received an additional $2,900).

As far as I know there is no specific documentation for the above and Turbo did not print out as well. Any help on how I can respond to IRS?

[tagteam]

I will page @Critter-3 

[VolvoGirl]

How old is/was your child?  You need to double check what the IRS sent you for the first 2 Stimulus payments.   Check your bank statements and even your IRS  account.   How much did you have on your original 1040 line 30 for the Recovery Rebate Credit?     Line 30 is only if you didn't get the full amount or qualify for more. Not the amount you already got.   The IRS shows you already got the first 2,900.  

EIP1 The first Stimulus payment was 1,200 for each spouse and 500 for each dependent under 17. Came out in spring of 2020.  So you  should have received 1200+1200+500=2,900

EIP2 The second Stimulus was 600 per person and dependents under 17. The 2nd stimulus checks started going out at the very end of December 2020 and continued into January/Feb 2021.  600x3=1,800

The first 2 Stimulus payments went on your 2020 return even if you got the second one in Jan/Feb 2021.

[sayarbai]

Thank you for your response.

1. My child is now 2.5 years old - she ws born in 2020. I made a clerical error in my original return where I said my child does not have the eligibility to work - the question from turbo was misleading.  So I received only $500 instead of $2,000.

2. I did login to my IRS account thro ID.me and do clearly see the stimulus payments received for 2020. It is two payments totaling $1,800.  When I looked at my original 1040 filed for 2020, I noticed that the stimulus payment that is stated as  received is as $2,400 which is incorrect. Not sure if I missed overriding what Turbo presented. I received only $1,800. I have the printout from IRS account statement. I was thinking to attach it to IRS response.

Your EIP1 and EIP2 makes sense to me. I should have received in total $2,900 + 1,800, but received only $1,800 based on my IRS acct.

Would you advice what docs I should attach?

[VolvoGirl]

Don't know what to do about the missing Stimulus.  You might check the IRS under your wife's ssn account.  If your child was born in 2020 they probably only sent you 2,400 based on your 2019 return.  So you need the 500 for the child.  

You probably didn't get the CTC  (and 500 stimulus) because you answered a different question wrong.  You had to answer YES on this one. ......  

Did your child live with you for the whole year? Answer YES even if they were born late in the year even on Dec 31. And same for how many months in the USA

Then was at least half of child's expenses paid by CHILD? Usually is NO, Child didn't pay for more than half of their living expenses.

So go back and look for those questions under Personal or My Info for your child.

[sayarbai]

Thanks. I will review Stimulus paid under my wife's SSN as well. Agreed with ur thought  process about why IRS may have missed the stimulus money for my child as they were unaware of 2020 new baby, and also the issue was  aggravated due to the mistakes in the original return.

Would you advice what documents I should attach as proof to claim:

1. Missed out CTC

2.Missed out Stimulus payments. 

Also would you detail the Stimulus I should have received for 2021 and also income limitations for 2020 and 2021 if any?

 thanks a bunch for taking the time to respond.

[sayarbai]

Reviewed my accounts again. We did receive $3,600 as total Stimulus money for the year 2020. This means my 1040X is incorrect in that claim.

So essentially I am missing

1. CTC for my daughter

2. My daughter's share of Stimulus Money of 2020 

Would you know whether in response to the IRS mail, I can attach a new 1040X with explanation ? 

[NCperson]

@sayarbai - I have read this a few times and still am having trouble on following it all.  Before you do anything, please answer the following:

1) what was the month and year of your child's birth?  What is the date on the SSN card? (it's normally in the lower left corner)

2)  on the originally filed tax return, what is on the following lines of Form 1040? 

      Line 19

       Line 28

      Line 30

[sayarbai]

Oh sorry that it was not clear.

1. Daughter' s date of birth : October 2020.

2. In the Original 1040 filed in 2021 for tax Year 2020:

Line 19: 500 ( This is the one which is incorrect - Should have been 2000)

Line 28: 0 

Line 30:  0 

[NCperson]

@sayarbai - was the child's SSN card issued prior to April 15, 2021?  lok at the card.  that is important. 

Also, what was your AGI on Line 11? there were limitations on the stimulus based on your income. 

what did the IRS SPEFICALLY REQUEST when they sent you the response letter. 

What I am trying to understand is whether they processed the 1040X or simply rejected it. 

if completed correctly,  the 1040X  shold have had 

1) a $1500 adjustment on line 7 

2) a $1000 adjustment on Line 15. 

3) please copy paste what you provided as the explanation in Part III. 

thx 

[sayarbai]

Hi @NCperson ,

1. Yes the SSN was issued prior to April 2021 - Confirmed

2. Line 11 AGI : 148,715

3. IRS said "But we don't have all the information to process it. The following list explains what we need". They seem to have looked at it but  stalled it. There are no specific 'list' specified in their letter. "Send any supporting forms or schedules to support the credits you are claiming in form 1040X" This is what they stated. They did not comment on either CTC or Stimulus additional claim. 

4. Yes,  my1040X was incorrect. The total Stimulus I received was entered incorrect. Instead of entering $3,600 I entered $1,800. Line  15 is displaying $2,900 (incorrect). But question to you: Should not line 15 be $1100 ? (EIP1: $500 + EIP 2: $600).  Line 7  is correctly displaying 1,500. 

5. I entered as follows as explanation:

    1.Incorrectly claimed less child tax credit for my daughter XXX.
    2. Recovery rebate credit was not claimed

Thanks a lot for getting into the details.  Do let know what I should do. 

[NCperson · Accepted solution]

@sayarbai so sounds like the 1040X was never processed.  You can verify this by looking at the transcript - there should be no adjustments as a result of the amendment.

So let's start over and here are my suggestions

1) Line 7 column B should show a $1500 adjustment

2) Line 15 column B should show a $1100 adjustment.  Be sure the 'other' box is checked and the works "RRC"- Recovery Rebate Credit"  placed on the line next to 'other'.

Be sure you complete Part I,  How did you complete this originally?  On Line 27, column A should be "1", column B should be a -1 and column C should be zero.  On Line 25, column A should be zero, column B should be "1" and column C should be "1".   

Be sure to list your dependent again with the SSN and check the CTC column box.  did you do that the 1st time? 

As the explanation for Part III, try this.

"Child born August XX, 2020. Did not originally claim RRC1 or RRC 2 for this newborn.  Further, inadvertantly did not claim Child Tax Credit which we are eligible for as newborn lived with us all year.  Amendment eliminates the $500 Tax Credit for Other Dependents and adds $2,000 for the Child Tax Credit, netting to $1500 adjustment."  

let me know!

[Critter-3]

. IRS said "But we don't have all the information to process it. The following list explains what we need". They seem to have looked at it but  stalled it. There are no specific 'list' specified in their letter. "Send any supporting forms or schedules to support the credits you are claiming in form 1040X" This is what they stated. 

HINT ... the CTC is what they are asking about ... did you not send the form 8812 with the 1040X?  That is what they need.   The stimulus credit is something that they will calculate automatically however you could send the TT worksheet for that line 30 calcuation.  

[sayarbai]

Hi @Critter-3  I thought Form 8812 is only if I am claiming Additional Child Tax Credit. Do note this is just standard CTC and NOT Additional CTC.  Do you think they are asking for 8812, I thought so at first and decided against it after I saw it is applicable only for additional CTC.  I would only have a 'keep for your records - work sheet'  (not 8812). Do let know. Thanks for ur response.

[sayarbai]

Thanks! @NCperson.  Are you thinking that it is okay to send ONE more accurate 1040X with details as you suggested as a response to the IRS letter ? Will they ignore the incorrect 1040X automatically?