First Economic Impact Payment Questions and Answers — Topic J: Reconciling on Your 2020 Tax Return

A1. Yes. Refer to the notice you received regarding your first Economic Impact Payment. These notices were  mailed to each recipient’s last known address within 15 days after the first payment was made.

If you did not receive the first payment or did not receive the maximum amount, you may be eligible to claim the 2020 Recovery Rebate Credit when you file your 2020 tax return.

A2. No, the payment is not includible in your gross income.  Therefore, you will not include the payment in your taxable income on your federal income tax return or pay income tax on your payment. It will not reduce your refund or increase the amount you owe when you file your 2020 federal income tax return.

A payment also will not affect your income for purposes of determining eligibility for federal government assistance or benefit programs.

A3. No, there is no provision in the law that would require individuals who qualify for a payment based on their 2018 or 2019 tax returns, to pay back all or part of the payment, if based on the information reported on their 2020 tax returns, they no longer qualify for the payment or would qualify for a lesser amount of the payment.

For example, you received $500 for your child who, based on your 2018 or 2019 tax return, met the qualifying child requirements. That child turned 17 in 2020 and no longer meets the qualifying child requirements. You will not be required to pay back the $500.

Or, for example, you received $500 for your child whom you claimed on your 2018 or 2019 tax return. You do not claim the child on your 2020 tax return because the child’s other parent claims the child. You will not be required to pay back the $500 even if the child’s other parent claims $500 for the same child on his or her 2020 tax return. 

Keep Notice 1444, Your Economic Impact Payment, with your 2020 tax records. The IRS mailed Notice 1444 to your last known address within 15 days after the payment was made.