uTax is sharing the latest updated IRS 2021 Recovery Rebate Credit Frequently Asked Questions (FAQs) Fact Sheet published yesterday, February 17, along with the associated news release.
- New for 2022, these IRS Fact Sheets are an excellent one-stop document containing the most frequently asked questions (FAQs) organized by topic, plus additional information and links to related resources. The IRS keeps them updated often so that you have the latest information as you prepare returns for your clients.
uTax continues to encourage our partners to review these FAQs and to follow the instructions and guidance provided by the IRS that is applicable to your client.
- Fact Sheet FS-2022-12 – Updated February 17, 2022 – 2021 Recovery Rebate Credit (RCC) Frequently Asked Questions
IRS News Release IRS IR-2022-40, February 17, 2022
IRS Provides Additional Updates to Frequently Asked Questions and Answers for 2021 Recovery Rebate Credit
WASHINGTON — The Internal Revenue Service today updated frequently asked questions (FAQs) for the 2021 Recovery Rebate Credit.
These FAQs (FS-2022-12 PDF) revisions are as follows:
- 2021 Recovery Rebate Credit — Topic A: General Information: Q3, Q6
- 2021 Recovery Rebate Credit — Topic B: Claiming the Recovery Rebate Credit if you aren’t required to file a 2021 tax return: Q5
- 2021 Recovery Rebate Credit — Topic D: Claiming the 2021 Recovery Rebate Credit: Q6
- 2021 Recovery Rebate Credit — Topic E: Calculating the 2021 Recovery Rebate Credit: Q7, Q18
- 2021 Recovery Rebate Credit — Topic G: Finding the Third Economic Impact Payment Amount to Calculate the 2021 Recovery Rebate Credit: Q2, Q7, Q8
Individuals who did not qualify for, or did not receive, the full amount of the third Economic Impact Payment may be eligible to claim the 2021 Recovery Rebate Credit based on their 2021 tax year information. Individuals may have received their third Economic Impact Payment through initial and “plus-up” payments in 2021.
Note: Third Economic Impact Payments are different than the monthly advance Child Tax Credit payments that the IRS disbursed from July through December 2021.
Most eligible people already received their Economic Impact Payments and won’t include any information about their payment when they file. However, people who are missing stimulus payments should review the information on the Recovery Rebate Credit page to determine their eligibility and whether they need to claim a Recovery Rebate Credit for tax year 2021.
- To claim any remaining credit for 2021, eligible people must file a 2021 tax return, even if they usually do not file taxes. Also, people who did not receive all of their first and second Economic Impact Payments in 2020 can receive those amounts only by filing a 2020 tax return (or amending a previously filed return) and claiming the 2020 Recovery Rebate Credit. They should review the Recovery Rebate Credit page to determine their eligibility.
- The 2021 Recovery Rebate Credit can reduce any taxes owed or be included in the tax refund for the 2021 tax year. Filers must ensure to not mix information from their 2020 and 2021 tax years. In particular, filers should take care to NOT include any information regarding the first and second Economic Impact Payments received in 2020, or the 2020 Recovery Rebate Credit, on their 2021 return. They will need the total of the third payment received to accurately calculate the 2021 Recovery Rebate Credit when they file their 2021 federal tax return in 2022.
Individuals can now view this information in their online account.
- People can also locate this information on Notice 1444-C, which they received from the IRS during 2021 after each payment, as well as Letter 6475, which the IRS will mail to them through March 2022.
More information on the Recovery Rebate Credit is available on IRS.gov.
Important Reminders! First and Second Recovery Rebate Credits that were not received cannot be claimed on the TY2021 return and instead, must be claimed on a TY2020 return.
If you didn’t get the full first and second Economic Impact Payments, you may be eligible to claim the 2020 Recovery Rebate Credit by filing a new or amended 2020 tax return.
If you didn’t get the full third Economic Impact Payment, see Questions and Answers About the Third Economic Impact Payment – Topic H: Reconciling on Your 2021 Tax Return.
Additional IRS Resources – Recovery Rebate Credit:
(Previously Shared) IRS News Release IR-2022-19, January 26, 2022 | Español
- All Third Economic Impact Payments Issued; Parents of Children Born in 2021, Guardians and Other Eligible People Who Did Not Receive All of Their Third-round EIPs can Claim up to $1,400 per person through the 2021 Recovery Rebate Credit
The uTax Team