Learn How to Claim the Recovery Rebate Credit
April 21, 2021
On March 27, 2020, the Federal Government of the United States approved the Coronavirus Aid, Relief, and Economic Security (CARES) Act and the COVID-Related Tax Relief Act in response to the big economic impact left by the SARS-COV-2 pandemic.
These acts are part of a financial assistance
plan destined to aid the population in the event of a natural disaster or a pandemic. Through these steps, the government aims to lend a helping hand to the American businesses, families, and workers that have been affected by such tragedies.
As such, the Federal Government of the United States created an impact payment program to provide financial protection to small workers and entrepreneurs, bringing payroll payment benefits for up to 8 weeks. American and foreign families collecting social security will be paid up to $1.200 per person. Unemployed individuals also received financial support. The benefits from these initiatives were set to run up until January 2021.
Many citizens have received economic impact payments, along with the benefits that these payments entail. If you are eligible for these benefits, you can learn how to claim your recovery rebate credit that the Internal Revenue Service (IRS)
has introduced to help first-time taxpayers and those who fail to meet the tax filing requirements as they file their 2020 taxes.
What Is the Recovery Rebate Credit?
The recovery rebate credit is authorized by the CARES act and the COVID-Related Tax Relief Act. Eligible individuals include those who have also been deemed eligible to receive economic payment and failed to get it / got a lower amount than the estimated payment for the year's economic stimulus. You can apply the claim at the same time you file your taxes.
It's important to clarify that this credit's first payment followed the person's tax information while filing the 2019 taxes. However, some instances in which the 2019 information wasn't available wound up following the information given during the 2018 tax statement. The second payment was based on the information given by all the taxpayers that filed their taxes in 2019.
How to Apply for the Recovery Rebate Credit?
To become eligible for the recovery rebate credit, you need to file your 2020 taxes since the credit will be allocated in relation to the year's tax information. The recovery rebate credit can be reduced according to the received impact payment.
How Can I Request the Recovery Rebate Credit?
As stated above, you need to file your 2020 taxes to request the recovery rebate credit and accelerate the refund process. If you have no experience requesting a recovery rebate credit, we recommend seeking the guidance of a professional tax preparer
to walk you through the process of preparing and filing your taxes. This will make the transaction go much more smoothly and help you save time to claim your recovery rebate credit.
We need to clarify that all non-eligible individuals for impact payment benefits can still apply and request a recovery rebate credit since the credit itself will be based on their 2020 tax statement. People claimed as dependent on someone else's taxes for 2018 and 2019 will also be considered for this credit. However, other entities can't claim them as dependent on their 2020 taxes.
Save Time Claiming the Recovery Rebate Credit with the Help of a Professional Tax Preparer
To move along faster with your recovery rebate credit payment, you need to make sure that you have a tax preparer in your corner to guide you through the process and organize your tax information. A professional tax preparer will also take care of filing your tax returns on time via the corresponding electronic channels while ensuring that no mistakes get in the way of a smooth, stress-free process.
Remember: United Tax & Accounting Group offers top-tier technology and the highest professional standards to guarantee the appropriate calculation of all federal taxes for both you and your business. We will simplify the process entailed in filing your taxes electronically and make sure that you can make the best of all the potential benefits.
With United Tax & Accounting Group on your side, you will count on the expertise of the best tax preparers in the industry. You will achieve proper feedback with your tax consultant and the process will be a lot easier to follow. If you want to know more about our tax preparation services to claim your recovery rebate credit during this tax season, you can always call (786) 431-5576 or fill out the contact
form on our website. We will be happy to provide personalized assistance for you and your business.