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Claiming Your Recovery Rebate Credit

Didn’t Receive Your Economic Impact Payment? You May Be Entitled To A Credit On Your 2020 Tax Return.

Americans living in New Zealand were eligible for the Economic Impact Payments (also referred to as stimulus checks or recovery rebates) included in the Coronavirus Aid Relief, and Economic Security (CARES) act.

Currently, the IRS has announced that the Treasury has issued all first and second round Economic Impact Payments. Taxpayers who did not receive their payments, or received less than the full amounts they were eligible for, can claim the Recovery Rebate Credit on their 2020 tax return.

What Is The Recovery Rebate Credit?

The Recovery Rebate Credit is a refundable credit allowable on your 2020 tax return. The credit is only for taxpayers who did not receive their Economic Impact Payment or did not receive the full amount they were eligible for.

Who Qualifies For The Credit?

Criteria for the credit is the same as the Economic Impact Payment. If you are a taxpayer who:

  1. Had an adjusted gross income (AGI) in 2020 of up to $75,000USD for individuals or up to $150,000USD for married filing jointly
  2. Has a valid Social Security Number
  3. Was not claimed as a dependent on another taxpayer’s tax return
  4. Is a U.S. citizen, permanent resident, or qualifying resident alien
  5. Did not receive the Economic Impact Payment or received less than the full amount.

You meet the qualifying criteria for the Recovery Rebate Credit.

Taxpayers should note that the credit is based on their 2020 income whereas the Economic Impact Payment was based on 2019 AGI. There is a possibility to claim the credit on your 2020 tax return even if you did not qualify from your 2019 AGI.

How Much Is The Credit Worth?

For single filers, the credit is worth up to $1,800USD. For married filing jointly, the credit is $3,600USD. If you are a taxpayer with qualifying children, you are eligible for up to $1,100USD for each child. Just like the Economic Impact Payment, the credit will phase out depending on your AGI.

How Do I Claim The Credit?

File your 2020 tax return to claim your credit, even if you do not normally file a tax return.

US Tax Pros Can Help!

As expats ourselves, we understand the complexities of being an American living abroad. We can help you determine your eligibility for the Recovery Rebate Credit. Contact us for more information.