The IRS has issued FAQs intended to help taxpayers and their preparers calculate the recovery rebate credit for 2021 returns.
Taxpayers must net their recovery rebate credit for the 2021 tax year against any economic impact payment (EIP) they received during the year.
In most cases, the 2021 EIP or recovery rebate credit amount is $1,400 for each eligible individual or double that for married couples filing jointly where spouses are eligible.
The FAQs address what the IRS refers to as “plus-up” EIPs, additional EIP payments based on a 2019 return or information from other government sources. The FAQs also include several other issues.