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COVID brought about a ton of financial changes in 2020. The biggest one on most minds was the stimulus payments that went out. It became a very confusing topic all year. The IRS has provided clarification. See below…
The current administration is working hard to pass further stimulus legislation. We’ll see what that brings in the coming weeks and months.
What About Past Stimulus?
The first two stimulus rounds are completed. The IRS has said it is not issuing any further payments. Those who feel they should have received more funds, can reconcile that on their 2020 tax return.
The Recovery Rebate Credit is the line item on 2020 tax returns that is providing added stimulus funds to those entitled to more money. 2020 income is used for the calculation.
Some folks who didn’t receive any stimulus previously, or didn’t receive full payments (due to income phaseouts or other reasons), may now qualify for the Recovery Rebate Credit by using 2020 income to put them in qualifying range for receiving stimulus funds. This will help many folks who saw their income drop from 2018 & 2019 to 2020.
We’re assessing each tax return to find our clients any added money due to them as a result of this Recovery Rebate Credit potential. This is free, non-taxable money you don’t want to miss!