23 Nov I didn’t get my third stimulus check. Did the IRS make a mistake?

Q. My wife and I were eligible for the third stimulus payment in the amount of $2,400 because we had a combined gross income of less than $150,000.00 in 2020. We received both the first and the second stimulus payments in 2020. We sold our home in the first half of 2021, and for whatever reason, the IRS mailed a paper check rather than send direct deposit for the third stimulus, which we never received. When we called the IRS, it said we had to file the Recovery Rebate Credit to get the money. But by the time we filed, our combined gross income in 2021 was greater than $150,000. The IRS confirmed we were no longer eligible. I feel that we were suckered out of the money because we moved and the IRS didn’t send the direct deposit. What do you think?
— Baffled sucker

A. This is a tough one, but you’re out of luck.

The stimulus program income limits were strict, but as you’ve seen, timing had a lot to do whether some people received the payments.

There is a difference in something sounding “right” as compared to being “correct,” said Steven Gallo, a certified public accountant and personal financial specialist with U.S. Financial Services in Fairfield.

He said the information you’ve received is correct.

“The third stimulus check that was issued in early 2021 was an advance payment of the 2021 Recovery Rebate Credit and was based on 2019 or 2020 tax information,” Gallo said. “Had you received that check you would have been able to keep the funds although your 2021 income exceeded the $150,000 threshold.”

The IRS did not require taxpayers to report in any way stimulus checks received in 2021, he said.

However, if you did not get your check you were entitled to apply for the 2021 Recovery Rebate Credit when filing your 2021 tax return, but you were now subject to the $150,000 income limit, he said.

This is where the difference between “correct” and “right” comes in, he said.

“The fact that your check was never delivered through no fault of your own forced you to verify your eligibility on your 2021 tax return where others who received their payment in advance had no such requirement and that just does not seem right,” he said. “I am sorry to say but you appear to be a victim of one of the many quirks in the Recovery Rebate program.”

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This story was originally published on Nov. 23, 2022.

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