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Recovery Rebate Credit for Tax Year 2023— Here’s What You Need to Know!

Recovery Rebate Credit
Recovery Rebate Credit

Simply put, Recovery Rebate Credit is a federal tax credit for those who need financial assistance. In this article, read and find out what you need to know about Recovery Rebate Credit for the tax year 2023!

Internal Revenue Service

Internal Revenue Service

The Recovery Rebate Credit was approved by the CARES Act. This program was intended to help people who were impaired by the financial crisis to receive their tax refunds as quickly as possible. The payments for this program were worth up to $4,000 and were distributed in two batches. The first batch was distributed in April 2020 and the second was in December 2020 until early 2021. The Internal Revenue Service (IRS) utilizes an applicant’s most current tax information to determine their eligibility and the amount of payment they can receive, as reported by Ann.

READ ALSO: How To Receive Tax Refunds Early— Here’s What You Should Know!

Who is eligible for these credits?

According to Ann, to be eligible for these credits, an applicant must have an adjusted gross income of less than $75,000 and must not be a dependent of any other taxpayer. The payments to be received will depend on the preceding tax year, therefore, an applicant must file a recent tax return. In addition, students can also claim the recovery rebate credits. To be eligible, an applicant must have been a full-time student in 2022 or must have been for at least 4 months in 2021. However, a student cannot claim the credits if they are already a dependent of a taxpayer.

Furthermore, a person may still be eligible to receive the credits if they received the third Economic Impact Payment. They may also do if they are a nonresident alien. Lastly, they may also not have a valid SSN by the due date of their tax return. Or if they have not claimed a dependent who has a valid SSN or ATIN.

READ ALSO: Around 300 Georgia Employees Received $6.7 Million Fraudulent Unemployment Benefits

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