January 27, 2021
If you were eligible and did not receive a stimulus check as part of the COVID-19 economic relief bills, you can claim the Recovery Rebate Credit on your Form 1040 (1040-SR for seniors) during the upcoming tax season, which starts on February 12, 2021. You can claim the credit electronically using tax software or on paper (the credit appears on line 30 of the paper form). The Recovery Rebate Credit will either decrease how much you owe or increase your tax refund.
Get to Know the Stimulus Checks
Two rounds of stimulus checks, also called economic impact payments (EIP), have gone out so far. The first was part of the CARES Act that passed in March 2020, and the deadline to register for these checks was November 21, 2020. The second economic relief bill passed in December 2020. These checks began dropping into people’s accounts during the first week of 2021, and the deadline for them to be sent out was January 15.
You can check the status of your stimulus check using the Get My Payment tool on the official IRS website. While some second round checks may still be en route to people’s mailboxes, other individuals may have been accidentally skipped over.
If you did not receive some or all of your stimulus checks from either round of payments, there is still an opportunity to claim your money. First, know whether you are eligible. Then, claim the credit on your tax return.
Are You Eligible for a Stimulus Check?
Stimulus check eligibility and payment method is based on your 2018 or 2019 tax return, but if you did not file taxes for those years, that doesn’t mean you aren’t eligible for a check.
The eligibility criteria for the first and second stimulus check are the same. Get to know these requirements, as specified by the IRS, so you know whether or not you qualify for the credit.
You are eligible for a A) first round stimulus check of $1,200 ($2,400 for a joint return) plus an additional $500 per qualifying dependent or a B) second round stimulus check of $600 ($1,200 for a joint return) plus an additional $600 per qualifying dependent if you:
- Are a U.S. citizen or U.S. resident alien
- Are not a dependent of another taxpayer
- Have a social security number valid for employment
- Or your adjusted gross income (AGI) does not exceed:
- $150,000 (if married and filing a joint return)
- $112,500 (if filing as head of household)
- $75,000 (if eligible and using any other filing status. If you exceed this AGI threshold, your stimulus check amount will be reduced by 5% of the exceeded amount.)
You are not eligible for a stimulus check if you or someone you are claiming:
- Are claimed as a dependent on another taxpayer’s return
- Don’t have a social security number valid for employment
- Are a nonresident alien
- Died before 2020
- Is an estate or trust
How to Claim the Recovery Rebate Credit
If you did not receive part or all of your stimulus check from either the first or the second round of payments, you can claim the Recovery Rebate Credit on your 2020 tax return. You can either file your taxes electronically or on paper. Either way, you’ll have the opportunity to report any missing funds you should have received as a stimulus check.
Before filling out your tax return, you should know the total stimulus payment amount you are owed. You can calculate how much you are owed using the eligibility criteria listed above. An electronic tax software will prompt you to input this number when filing, or if you’re filing by paper, this number will go in the box on line 30 of the worksheet. Your credit will automatically decrease how much you owe in taxes or increase how much money you get back.
How can Cushion help me?
Cushion Bill Pay gives you more visibility and control over your finances than ever before. Many people get hit with bank fees—such as overdrafts and late fees—due to cash flow problems. With Cushion, you can consolidate and track all of your bills and BNPL payments in one place, plan your budget by reviewing what’s coming down the pike, and avoid overdraft fees by temporarily pausing payments that might overdraft your account and resuming them when you are ready.
