Thousands of people who didn't get the first or second stimulus payments they were owed have been told to recoup their money at tax time. But it's not so easy.
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Before you file a stimulus credit on your taxes, you need to make sure your missing payment has been officially traced.
"If you didn't get your economic impact payments or if you think you qualify for more than you received, don't worry, if you're eligible you can claim a recovery rebate credit when you file your 2020 tax returns this year," said Kemberly Washington, Forbes advisor and tax analyst.
It may sound easy, but heed this warning before filing for that tax credit for stimulus money that didn't come through.
The IRS and financial experts say you first need to request a payment "trace" so the IRS can first determine if they can find the money or see if the payment was received. If the IRS can't re-issue the payment, then you file for the credit.
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"So what you're gonna do is, you have to pick up the phone and you have to have in the trace that payment. They have what's called payment traces actually on a website, or you have to call them and let them know, 'I need a pick a payment trace concerning this credit, this payment, because I've never received it,'" Washington said. She adds that the IRS requires this trace first, so people can't double-dip and get a credit along with a recovered payment.
However, if you have gone to the IRS "Get My Payment" link, and there is no record of a payment ever being issued or mailed -- and you believe you qualify -- Washington said, go ahead and claim the tax credit. It's line 30 on your 1040 tax form.
"If you're someone who didn't receive the credit at all, no notice, you can claim it. If you're someone who received the partial payment, you can claim it, but if your check was lost in the amount you can't claim it. You need to do what's called a payment trace, contact the IRS and have them start researching to see where this money went and then they'll give you to go ahead and claim that credit," Washington said.
Washington said you can also immediately claim the credit on your taxes if "you are a person who adopted a child in 2020, or if you are a person who gave birth to a child in 2020, you may be eligible for additional stimulus payment and you're able to claim the credit for 2020."
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Finally, all stimulus recipients will get this 1444 form for taxes, this form will also have information on it if you are dealing with a missing payment.
If your tax situation is complicated, you may want to turn to a trusted tax preparer who has a tax preparer IRS ID number.
If you make $72,000 or less, you can file your federal tax return for free through the IRS Free File Program.
The IRS also said the fastest way to get your tax refund is to file electronically.
Information on the Recovery Rebate Credit is available on IRS.gov.https://www.irs.gov/newsroom/recovery-rebate-credit