{"id":54950,"date":"2021-02-25T05:42:00","date_gmt":"2021-02-25T11:42:00","guid":{"rendered":"https:\/\/www.hrblock.com\/tax-center\/?p=54950"},"modified":"2024-08-05T13:53:09","modified_gmt":"2024-08-05T18:53:09","slug":"recovery-rebate-credit","status":"publish","type":"post","link":"https:\/\/www.hrblock.com\/tax-center\/filing\/credits\/recovery-rebate-credit\/","title":{"rendered":"A recovery rebate credit is your way of getting missed stimulus money"},"content":{"rendered":"\n

Editor\u2019s Note: This article was originally published on December 31, 2020.<\/em><\/p>\n\n\n\n

Stimulus payments have been a critical lifeline for many Americans during the coronavirus crisis. But what if you didn\u2019t receive the full amount due to life changes such as a new baby or lower income? Rest assured, there\u2019s a way to solve this\u2014in the form of a recovery rebate credit.<\/p>\n\n\n

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\"Recovery<\/figure><\/div>\n\n\n

You might be wondering what exactly a recovery rebate credit is and what it has to do with your stimulus. You\u2019re not alone\u2014it\u2019s not a common term.<\/p>\n\n\n\n

The recovery rebate and your stimulus payments are actually one in the same. It\u2019s just that the recovery rebate credit is paid as part of filing your return. <\/p>\n\n\n\n

Note: This credit is also sometimes called stimulus reconciliation or in casual terms, stimulus backpay or refund recovery credit.<\/p>\n\n\n\n

Already know all about this credit?<\/strong> Find out how H&R Block can help you help you<\/a>. Learn more about how to claim your recovery rebate credit<\/a>.<\/p>\n\n\n\n

Getting the additional stimulus money you need: How Block can help<\/h2>\n\n\n\n

When the stimulus payments were calculated in 2020, they were intended to be an advance credit on your 2020 return. To get the payments out quickly, the IRS used your most recent tax information to determine how much you should receive. For most, that calculation was spot on.<\/p>\n\n\n\n

For some, the stimulus payments missed life changes that could have increased the total amount received\u2014often, exactly when they need money the most. Sound familiar? Luckily, we can help close the stimulus gap.<\/p>\n\n\n\n

You can rely on H&R Block\u2019s expertise to help you claim any additional stimulus money you\u2019re due through a recovery rebate credit.<\/p>\n\n\n\n

See how the recovery rebate credit works<\/h3>\n\n\n\n

Scenario 1 \u2013 Recovery Rebate Credit and first-time filers<\/h4>\n\n\n\n

Shelly, a 2020 college graduate, didn\u2019t receive any stimulus in the first round because she was claimed as a dependent on her parent\u2019s 2019 return. However, she is no longer a student and doesn\u2019t qualify as her parent\u2019s dependent for 2020. When she files her own return for 2020, Shelly can claim the recovery rebate credit to receive the $1,200 for the first round of stimulus and $600 for the second round of stimulus.<\/p>\n\n\n\n

Tip: <\/strong>If you\u2019re a college student new to filing, check out our Student Tax Filing Guide<\/a> for help with this year\u2019s taxes.<\/p>\n\n\n\n

Scenario 2 \u2013 Recovery Rebate Credit and unemployment <\/h4>\n\n\n\n

Tyler worked as an occupational therapist until March when he was furloughed for several months. During that time, he received some unemployment income but his overall 2020 income was less than his 2019. Based on his 2019 return, he received $950 for the first round and $475 for the second round of stimulus. When he files his 2020 return, the drop in his income means he\u2019ll be eligible for an additional $375 ($250 for the first payment and $125 for the second).<\/p>\n\n\n\n

Scenario 3 \u2013 Recovery Rebate Credit and a new baby<\/h4>\n\n\n\n

Jo and Nic married in January 2020 and had a baby in October 2020. They were both single on their 2019 returns, and they each received $1,200 in first round of stimulus checks in 2020. When they file their 2020 return, they will claim their child on the return and determine they should receive $1,100 in additional recovery rebate credit ($500 for round one plus $600 for round two). <\/p>\n\n\n\n

Scenario 4 – Recovery Rebate Credit and a divorced couple<\/h4>\n\n\n\n

Gerri and Larry divorced early in 2020 and have no dependents. Based on their 2019 jointly filed return, they didn\u2019t qualify for any stimulus due to Gerri\u2019s income. When Larry files as Married Filing Separately in 2020, he only has $50,000 in gross income and qualifies for $1,200 with the first round of stimulus and $600 for the second round.<\/p>\n\n\n\n

Who qualifies for a recovery rebate credit (stimulus backpay)?<\/h2>\n\n\n\n

The qualifications start with stimulus eligibility. For the first and second stimulus payments, that includes everyone except those:<\/p>\n\n\n\n