21 Jul AiroAV Announces How Will I Claim Additional Stimulus Money? | Taxes
That’s because stimulus checks, officially called economic impact payments, were technically advances of a 2020 tax credit, which can be claimed in 2021. Taxpayers who experienced a 2020 income loss, the birth of a child or another qualifying event could be eligible for more than they received in their initial stimulus check.
Here’s the good news: “You’re going to be able to claim the additional amounts that you were owed on your 2020 tax return when you file it,” says Henry Grzes, lead manager for tax practice and ethics at the Association of International Certified Professional Accountants.
Wondering what that process will look like? Some details still need to be revealed to the public, but here’s what you can do to prepare to claim additional economic impact payments funds on your 2020 taxes.
Who Can Claim More Stimulus Money on Their 2020 Taxes?
In the rush to get payments out, Uncle Sam used your 2018 or 2019 income and family information, based on that year’s tax return. But if your situation changed in 2020, you may be eligible for more stimulus money than you initially received. Some reasons you could receive additional stimulus money in 2021 – when you file your 2020 income taxes – include:
- You experienced an income loss that qualifies you for more stimulus funds.
- You had or adopted a child, qualifying you for the additional $500.
- You were divorced, impacting your 2020 income or filing status.
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 filing jointly. The full $1,200 per taxpayer is available to 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 age 17.
So, say you earned $100,000 as a single, childless filer in 2019, but this year’s shutdowns and layoffs halved your 2020 income to $50,000. You may have been ineligible to receive any stimulus money when the checks were initially sent, but when you file your 2020 income taxes, you could receive the full $1,200 for a single filer.
What Documents Do I Need to Claim Additional Stimulus Money?
If you suspect that you’ll be claiming additional economic impact payment funds on your 2020 income taxes, make sure to keep a few documents on hand. Lawrence Pon, a tax specialist who owns an accounting firm in San Francisco, recommends that his clients keep a copy of Notice 1444. That’s the letter revealing your stimulus payment amount and how it was made. It’s signed by President Donald Trump. It should have arrived a few weeks after your check or deposit did.
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 on hand. If you’re taking it to a bank, make a copy first.
“Any kind of proof that the IRS provides you, you’d want to keep to make sure you’d ultimately get the amount you’re entitled to,” Grzes says.
In the future, it’s possible that the IRS will send some confirmation of the amount you received in a form like a 1099, Grzes says, but we’ll have to wait to find out.
Perennially important tax documents such as W-2 and 1099 forms will also come in handy when verifying your income.
How Do I Claim Additional Stimulus Money?
It remains to be seen exactly how your tax forms will ask for information about the economic impact payment reconciliation. Pon predicts it will most likely be addressed on line 18, page 2 of Form 1040 and on part 2 of the Schedule 3.
You’ll likely be able to input relevant information in your tax software program, old-school paper forms or when working with a tax professional.
In the meantime, it can be frustrating to wait on stimulus money if you’re struggling to make ends meet. If you believe you’ll receive additional stimulus money when filing your 2020 income taxes, and you’re due a tax refund, aim to file taxes quickly after the IRS starts accepting returns in January.