As a follow-up to our previous communication Important! IRS Updates FAQs for the Recovery Rebate Credit, Partner Support is sharing another important update issued today by the IRS regarding the Third Recovery Rebate Credit.
We strongly encourage our partners to read this news release in it’s entirety, as it contains helpful information and guidance on many questions we are receiving on how to claim this credit for eligible individuals and dependents. Also included in this news release are instructions on how to claim the First and Second Recovery Rebate Credit if not received (cannot be claimed on the TY2021 return).
IRS News Release – IR-2022-19 – January 26, 2022 | Español
All Third Economic Impact Payments (EIPs) Issued; Parents of Children Born in 2021, Guardians and other Eligible People Who Did Not Receive all of their Third-round EIPs Can Claim up to $1,400 per Person Through the 2021 Recovery Rebate Credit
Excerpt Only: The Internal Revenue Service announced today that all third-round Economic Impact Payments have been issued and reminds people how to claim any remaining stimulus payment they’re entitled to on their 2021 income tax return as part of the 2021 Recovery Rebate Credit.
Parents of a child born in 2021 – or parents and guardians who added a new qualifying child to their family in 2021 – did not receive a third-round Economic Impact Payment for that child and may be eligible to receive up to $1,400 for the child by claiming the Recovery Rebate Credit.
While some payments of the Economic Impact Payments from 2021 may still be in the mail, including, supplemental payments for people who earlier this year received payments based on their 2019 tax returns but are eligible for a new or larger payment based on their recently processed 2020 tax returns. The IRS is no longer issuing payments as required by law. Through December 31, the IRS issued more than 175 million third-round payments totaling over $400 billion to individuals and families across the country while simultaneously managing an extended filing season in 2021.
Third-round Economic Impact Payments were advance payments of the 2021 Recovery Rebate Credit. In late January, the IRS began issuing Letter 6475, Your Third Economic Impact Payment, to recipients of the third-round Economic Impact Payment. This letter will help Economic Impact Payment recipients determine if they are entitled to and should claim the Recovery Rebate Credit on their 2021 tax returns when they file in 2022.
Click on IRS News Release above to read entire news release.
We realize it’s a busy time for tax professionals, but if you’re not already a subscriber, please be sure to sign-up for e-News subscriptions to stay informed on these important IRS COVID-Relief updates and other tax topics to help ensure you are preparing accurate TY2021 returns for your clients. We especially recommend:
- IRS Newswire
- e-News for Tax Professionals
- IRS News in Spanish (Noticias del IRS en Español)
- IRS Tax Tips
The Partner Support Team
Additional IRS Resources: TY2021 Recovery Rebate and Child Tax Credits
IRS News Release IR-2021-255, December 22, 2021 | Español
- IRS Issues Information Letters to Advance Child Tax Credit Recipients (Letter 6419) and Recipients of the Third Round of Economic Impact Payments (Letter 6475); Taxpayers Should Hold onto Letters to Help the 2022 Filing Season Experience
Recovery Rebate Credit Information:
IRS News Release – IR-2022-13 – January 13, 2022 | Español
- IRS Issues Frequently Asked Questions and Answers for 2021 Recovery Rebate Credit
The 2021 Recovery Rebate FAQ topics are:
Child Tax Credit and Advanced Child Tax Credit Payments Information:
IRS News Release – IR-2022-10, January 11, 2022
- IRS Updates FAQs for 2021 Child Tax Credit and Advance Child Tax Credit Payments
The 2021 FAQ Topics Are: