Why does the stimulus money increase the amount I owe on my federal return (Tax Year 2020)

[DoninGA]

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@toddk911 wrote:

I got the CP11 also and the letter 6475 saying that I got the 2,800 3rd stimulus check so they reduced my refund, however, i never got a 3rd check.

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Go to this IRS website for your tax account to see if the 3rd stimulus payment is entered - https://www.irs.gov/payments/your-online-account
If you are Married Filing Jointly also check your spouse's tax account.

If you checked your bank account in the March - May 2021 timeframe and there is not a $2,800 EIP3 payment from the IRS then go to this IRS website for how to start a trace on the payment - https://www.irs.gov/newsroom/questions-and-answers-about-the-third-economic-impact-payment-topic-j-p...

[toddk911]

Awesome!!! Thank you!

[grammalinda]

B4 the stimulus income I had a refund on my federal return. after i owe!!! whY??

[grammalinda]

i agree!! it makes no sense

[VolvoGirl]

It is not taxable and you aren't paying it back.  Your 2021 return starts out by assuming you didn't get any Stimulus payments so it gives you credit for the full amount and your refund was too high.  Then near the end you enter how much you actually got so it only gives you the difference if any.  So you don't get it again.

Look at your tax return.   It is not added as income anywhere or subtracted anywhere.  The Recovery rebate credit on line 30 is only if you didn't get the Stimulus payment or qualify for more.

Then if you try to claim it again on line 30 but the IRS already sent it to you they will take it off your return and reduce your refund or send you a bill.  Line 30 is only if you didn't get the full amount or qualify for more. 

[revroe7]

turbo tax tax me extra on my return for the2021 stimulus check it increase the tax amount I owe

[MayaD]

The stimulus payment is not taxable. 

When you start your return, TurboTax assumes that you haven't received stimulus payment, so it begins giving you the maximum amount.

When you enter the actual amount received, it adjusts your refund to account for that.

[Cheflibby]

Our letter 6475 specifically states not to enter this as income and it isn't taxable.  On what form is this credit, there is something very weird going on!!!

[AamilD]

@Cheflibby , It is not taxable. When you start the tax return, it assumes you did not get any credit and give you the full stimulus amount. As you proceed with your return and in the end, where it asks you how much you received as stated on Letter 6475 and you enter the information, since you now state you already got the stimulus payment, it removes the credit it gave you initially when you started the return.

Recovery Rebate Credit is on Line 30 of Form 1040.

[Cheflibby]

I tried to be agreeable and say "yes, that's exactly what my letter says", and my tax owed went up again!!!  I tried deleting the whole form...my taxes are soooo messed up now.  There isn't anyway to go back and adjust anything.  This is ridiculous!!

[SaulofYorbaLinda]

Its pretty stupid, but that's the way it works.  Apparently the deds took out "some" withholding but do not consider it enough so they want more and it increases your tax liability.   

[Cheflibby]

I'd love to look at my return, exactly where is that option in TT, I only have the option to delete forms!!

[DoninGA]

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@Cheflibby wrote:

I'd love to look at my return, exactly where is that option in TT, I only have the option to delete forms!!

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You can view your Form 1040 at any time using the online editions. Click on Tax Tools on the left side of the online program screen. Click on Tools. Click on View Tax Summary. Click on Preview my 1040 on the left side of the screen.

[JamesG1]

In TurboTax Online:

• View the Federal 1040 tax return at Tax Tools / Tools / View Tax Summary / Preview my 1040.
• View all forms at Tax Tools / Print Center / Print, save or preview this year's return / Include government and TurboTax worksheets.

@Cheflibby