Who and How to Get $1,100 in Extra Stimulus Cash for Babies born in 2020
|Who anđ How to Get $1,100 in Extra Stimulus Cash for Babies born in 2020|
The details of the American Rescue Plan (President Joe Biden's $1.9 trillion relief package, which includes a third stimulus check maxing out at $1,400 per person), Eligible parents who welcomed a new baby in 2020 and haven’t received an economic impact payment for their child as a dependent could qualify for up to $1,100 of extra stimulus money.
However, Millions of Americans are still missing stimulus payments from the first and second checks. Among them are the parents of children born or adopted between Jan. 1 and Dec. 31, 2020, CNet report.
Children born between Jan. 1 and Dec. 31 of 2020 qualify for both stimulus payments if their parents meet income limits: $500 from the first check and $600 from the second round.
The reason why some stimulus check recipients may have missed out on the extra cash is that the Treasury and IRS used 2019 tax returns to calculate the automatic payments, which would not have included babies born in 2020.
The child credits are subject to the same phaseouts based on income limits as payments for adults, MSN report.
- $75,000 if you’re a single filer.
- $112,500 if you’re head of household.
- $150,000 if you’re married and file a joint return.
To get the extra stimulus money for your baby (if you haven’t already received the dependent stimulus cash), you will need to file a tax return and get the money the IRS owes you as a recovery rebate credit.
The credit is made possible by the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Any eligible person who did not receive their stimulus checks can claim the recovery rebate credit on a 2020 Form 1040 or Form 1040-SR.
Here's how to calculate your family's third stimulus check total and when the baby payment could arrive:
How much extra stimulus money can parents of 2020 babies expect to receive?
Congress is currently ironing out plans for a third stimulus check, which would grant parents a maximum of $1,400 per qualifying dependent. But parents of babies born in 2020 are actually eligible for more than just this $1,400 check -- an extra $1,100 could be coming your way even before the next bill passes if you met all the requirements for the first two stimulus checks. This is the amount of the two stimulus checks other families received for dependents in 2020 ($500 plus $600). If you missed out on these checks earlier this year, it's because the IRS used 2019 returns to automatically send out payments. To apply, fill out the Recovery Rebate Credit form.
Parents of 2020 babies should file their tax returns ASAP
There's a simple way to recoup missing stimulus money for qualified dependents -- any missing stimulus money, actually: File your 2020 tax return as soon as possible. In fact, your 2020 tax return is the mechanism for updating anything that has changed in your stimulus eligibility since the passing of the CARES Act. That's because once your 2020 return is on file, the IRS will use your new information to process future stimulus benefits. You can also set up direct deposit with the IRS when you file your return if you haven't already, to ensure you get your next stimulus check as quickly as possible.
How to claim missing dependent stimulus money when you file taxes
Before you prepare your 2020 tax return, you need to calculate how much stimulus check money you were owed and determine how much you actually received. Any discrepancies between the two numbers can be claimed through the Recovery Rebate Credit on your return. (That is, unless you received more than you were owed. Here are all the reasons you may actually have to return stimulus money to the IRS.)
If your missing stimulus money is the result of an IRS error or other mistake, a payment trace will likely be a better avenue for hunting down your check. But if you merely need to claim a new dependent, the Recovery Rebate Credit is what you're looking for.