Why are my federal taxes increasing in TurboTax when I put in my stimulus check payments

[bacyoung]

I am doing my 2020 taxes, and when I key in the amount of the two stimulus checks my husband and I received, the first one and then the second one, our federal taxes are increasing. I thought that we didn't pay tax on these checks, and that our taxes would not be affected.

[xmasbaby0]

The stimulus checks are not taxable.   Where did you enter them?  Sounds like you entered them in the wrong place.

The stimulus check is an advance on a credit you can receive on your 2020 tax return.  If something went wrong or you did not get the stimulus check in 2020, you can get it when you file your 2020 return in early 2021

The Recovery Rebate Credit will be found in the Federal Review section,  If you are eligible it will end up on line 30 of your 2020 Form 1040.

https://www.irs.gov/newsroom/economic-impact-payment-information-center-topic-j-reconciling-on-your-...

https://www.irs.gov/coronavirus/coronavirus-tax-relief-and-economic-impact-payments-for-individuals-...

https://ttlc.intuit.com/community/tax-topics/help/how-will-the-stimulus-package-impact-me/00/1393859

[VolvoGirl]

You are not paying tax on them.  But Turbo Tax started out by giving you credit for the whole amount so you refund was too high.  Then when you entered what you already got the starting refund was reduced or the tax due increased.  You don't get it twice.

[xmasbaby0]

Oh----it is the information flow......

You might have become confused by the flow of information in the software.   That "refund monitor" on your screen displays a "refund" amount that includes the stimulus money. as part of your 2020 refund.   But later when you enter the amount of stimulus you really received already, it removes the stimulus already given to you.   And it looks to you like you "lost" your refund,   But ---you do not get the same stimulus money twice--that is why it came out,

[bacyoung]

Hi

I entered the amounts in the Federal Review section when they ask if I received the stimulus checks.  There is a box to put the first one and then the second one. 

[VolvoGirl]

Right but Turbo Tax was already giving you credit for the Stimulus amounts again before you entered that you received it,  so it took out the credit because you already got it it.  Otherwise you would be getting it twice.

[bacyoung]

Thank you for your help - very much appreciated.