How will I claim additional stimulus money? | Taxes

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Indeed, stimulus checks, officially called economic impact payments, were technically advances of a 2020 tax credit, which can be claimed in 2021. Taxpayers who suffered a loss of income in 2020, birth of a child or other qualifying event might be eligible for more than they received in their initial stimulus check.

Here’s the good news: “You’ll be able to claim any additional amounts that were owed to you on your 2020 tax return when you file it,” says Henry Grzes, senior tax practice and ethics manager at the Association of International. Certified Professional Accountants.

Wondering what this process will look like? Some details have yet to be revealed to the public, but here’s what you can do to prepare to claim additional Economic Impact Payment funds on your taxes 2020.

Who can claim more stimulus money on their 2020 taxes?

In the rush to get payments, Uncle Sam used your income and family information from 2018 or 2019, based on that year’s tax return. But if your circumstances have changed in 2020, you might be eligible for more stimulus money than you initially received. Some reasons you might receive additional stimulus money in 2021 — when you file your 2020 income taxes — include:

  • You have suffered a loss of income that qualifies you for more recovery funds.
  • You had or adopted a child, qualifying you for the additional $500.
  • You were divorced, which impacted your income or filing status in 2020.

Remember: Americans who qualify for a stimulus check are taxpayers earning an adjusted gross income of less than $99,000 if single or $198,000 if married and filing jointly. The full amount of $1,200 per taxpayer is available for single filers earning less than $75,000 and married filers earning less than $150,000. An additional $500 per dependent is available for taxpayers with children under 17.

So, let’s say you earned $100,000 as a single filer with no children in 2019, but closures and layoffs this year halved your 2020 income to $50,000. You may not have been eligible to receive stimulus money when the checks were originally sent, but when you file your 2020 income taxes, you could receive the full $1,200 for just one filer. .

What documents do I need to claim additional stimulus money?

If you think you’ll be claiming additional Economic Impact Payment funds on your 2020 income taxes, be sure to keep a few documents handy. Lawrence Pon, a tax professional who owns an accounting firm in San Francisco, recommends that his clients keep a copy of Notice 1444. This is the letter revealing the amount of your stimulus payment and how it was carried out. It is signed by President Donald Trump. It should have arrived a few weeks after your check or deposit.

Pon also suggests keeping a copy of the paper check if you received one. If you deposited the check via mobile phone, keep the original handy. If you take it to a bank, make a copy first.

“Any kind of proof that the IRS gives you, you’d want to keep that to make sure you ultimately get the amount you’re entitled to,” Grzes says.

In the future, the IRS may send confirmation of the amount you received in a form like a 1099, Grzes says, but we’ll have to wait to find out.

Always important tax documents such as W-2 and 1099 forms will also be useful when checking your income.

How can I claim additional stimulus money?

It remains to be seen exactly how your tax forms will request information on reconciling economic impact payments. Pon predicts that he will most likely be processed on line 18, page 2 of Form 1040 and Part 2 of Schedule 3.

You’ll likely be able to enter relevant information into your tax software, old-fashioned paper forms, or when working with a tax professional.

In the meantime, it can be frustrating to wait for stimulus money if you’re struggling to make ends meet. If you think you will receive additional stimulus money when you file your 2020 income taxes and need to tax refundaim to file your taxes soon after the IRS begins accepting returns in January.

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