The recovery rebate credit is the refundable tax credit that was paid in advance to most taxpayers. The payment from this tax credit is or was basically your stimulus check. Most taxpayers are eligible for a maximum amount from the credit but there are income limits, the same as any other tax provision.
The worksheet for the recovery rebate credit is not complicated at all, especially if you have an IRS online account. Log in to your online account and see how much you’re eligible for it. You’ll also receive an IRS Notice 1444, stating how much you can get. Although these are mostly for those who have already filed a federal income tax return in 2018 or 2019, nonfilers can use their IRS account to figure out their rightfully owned recovery rebate credit amount.
While most taxpayers received their recovery rebate credits in advance payments as a stimulus check, you don’t really need to use a worksheet whether it’s a PDF file or not to see how much you can get. Your AGI is what it takes to determine eligibility for the credit.
Claiming recovery rebate credit on 1040
Get the recovery rebate credit on your 1040 the same as you would with any other tax credit. Like how you enter the child tax credit amount on Line 19, enter the recovery rebate credit amount you’re eligible on Line 30. Since the amount you get with the recovery rebate credit is directly tied with your adjusted gross income, you won’t need to attach additional documents to your tax return to verify how much you can get.
Refundable portion of the recovery rebate credit
The recovery rebate credit is fully refundable. Regardless of how much you can get, you’ll get it refunded to you as long as you don’t have any tax liability. If you owe taxes though, the credit amount will be reduced from the tax owed. In either case, you’ll get full benefits of the tax credit as it’s not like the child tax credit 2021 where the refundable portion is reduced whereas you get the full amount if you owe taxes. The recovery rebate credit brings much more value than any other tax credit and the only eligibility requirement is your adjusted gross income.