Did you receive stimulus money more than you should or did not receive anything at all?
Yes, You have to send your stimulus money back to IRS if you were one of the unqualified citizens who were offered checks mistakenly by them. Keep reading to know if you belong to the qualified group who could keep their stimulus money without trouble.
The IRS paid a third stimulus amount of one hundred and sixty-one million rupees to individuals and families eligible to pay. This value also includes “plus-up payments” for those citizens eligible for a larger check according to their 2020 tax returns. The news says that IRS has made a mistake and has paid money to people that it should not have paid. Now how does IRS going to fix this financial mess?
IRS needs unqualified citizens to repay the stimulus money. But this process is complicated for most of us. For example, imagine IRS has sent the first stimulus checks erroneously and, you might have received one of those.
Now you have to return the stimulus money and, you have to follow specific procedures to send the money back to IRS depending on the payment method used like paper checks, EIP cards, or direct deposits. This article will discuss the instances that you have to return the stimulus money you have received and the procedures you have to follow as recommended by the IRS.
What to do if I have received stimulus money that I am not eligible for with the $1,400 check?
The income limit to receive a third stimulus check is as follows,
- $80,000 for an individual taxpayer
- $120,000 for a head of household
- $160,000 for married couples who file taxes jointly
If you are someone who is earning more than the cutoff income levels given above and still received payment, the IRS will probably need you to return the whole sum of stimulus money or a fraction of it.
There is an exception for this case. If you made more money in 2020 than you made in 2019, but you received the stimulus check before filing your taxes for the year, then you will not be expected to return that money.
Why do I have to return a fraction of or all of the stimulus money I received?
It is up to the government to decide who is and is not qualified to receive a stimulus check, and this decision is made based on a range of factors. For example, if you belong to any of the criteria given below and yet received a stimulus check, it can be due to the payment error.
- Received a check for someone who has died (there are more facts to consider here)
- You do not have a Social Security number of your own.
- A person who is considered a “nonresident alien” without a US citizen spouse.
- You are a non-citizen who files federal taxes.
- The year’s adjusted gross income exceeds the income limit (For example, you made $90,000 and files taxes as a single-payer).
- You are claimed to depend on someone else’s taxes (Applies only to the first and second stimulus checks).
- Received the same payment round twice.
What to do if a family member in my household died?
You might have received payment for someone from your household who died in 2019 or earlier. According to the IRS, you are expected to return the entire amount unless paid to joint filers and one spouse is still living. If you are filing taxes as a married couple and the living spouse, you have to return half of the payment that will not be more than $1,200 in all.
But in cases where the check was issued in both names, yours and your spouse’s name, that makes it impossible for you to deposit the check; you will have to return the check with the whole amount to the IRS. IRS will process the check removing your deceased spouse’s name and, they will issue a new check with the correct amount that you should receive to your name.
When it comes to the third check, it is all about the tax return the IRS uses. If it is considering your 2019 tax return, you might get the chance to keep the amount you received for the person who has died.
I have already cashed/deposited the stimulus payment I received. How can I return my stimulus money to IRS now?
IRS has specified a procedure for citizens who have already cashed or deposited their stimulus checks but have to return them now. These are what IRS has recommended for you.
- You can use a check from a personal account or money order. The check must be paid to the U.S. Treasury. You are expected to write “2020 EIP” in the check. Then include the taxpayer identification number or Social Security number of the person whose name was written on the check.
- You have to formally inform the IRS why you are sending the check back. Again, it is important to use a separate paper for this.
- Then mail the check to the appropriate IRS location. The location depends on the state you are living in.
I did not cash or deposited my stimulus check. So how do I get it back to the IRS?
If you are an unqualified person who is not eligible to receive stimulus but have received it and you still have the check, this is what IRS wants you to do.
- You have to write the word “VOID” in the endorsement section on the back of the check.
- Please do not bend, paper clip, or staple the check you are planning to return.
- You have to inform the IRS why you are sending the check back. Take a separate sheet of paper and write the reason on it.
- Now, you can mail the check to the appropriate IRS location. This location differs depending on the state you are living in.
My stimulus money never arrived. What can I do?
This guideline is for the people who have been eligible to receive the first or second stimulus check, but you never received it. You have the chance to claim it as a Recovery Credit Rebate on your 2020 taxes this year. You can claim it even if you do not usually file taxes. Under the other option, you might have to start an IRS payment trace.
In a case where you have not received the third check, or the amount you received is way below your expectation, you might receive a plus-up payment from IRS when it gets your 2020 tax returns.
Please consult the IRS for additional information if you:
- Receive SSI or SSDI benefits
- Receive veterans benefits
- You do not usually file taxes
- Are an older adult or younger adult
- You had a new baby