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Stimulus payment: The IRS could owe you 'plus-up' money. What the new check is about

If you got a smaller amount with your stimulus check than the IRS owes you, you might be due a plus-up payment. Here are the details.

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The IRS is now sending out "plus-up" payments as it processes 2020 taxes. Here's what that means for your stimulus check total.

Angela Lang/CNET

You may have received your third stimulus check already, but the IRS may not be done sending you money. If the IRS underestimated the amount of money you received in that third check that you qualified for based on older tax information, it may send you a "plus-up" payment once the agency receives your 2020 tax forms.

The IRS sent out 700,000 of these plus-up payments with last week's batch, for $1.2 billion. And the IRS will continue to make these plus-up payments weekly. What can you expect if you didn't file taxes in 2019 or haven't filed your 2020 return yet? (Unless you request an extension, you'll have to file by the new May 17 deadline.) What if your circumstances have changed since you last filed, like if you earned less income in 2020 or you had a baby?

Here's how to watch out for another payment and what you can do to make sure you get all the stimulus money you're eligible for. Also, here is what you need to know about how much money you could get from the expanded child tax credit, what is happening with student loan debt forgiveness and how to find out if your state owes you money. This story has been updated recently.

How do you qualify for a plus-up payment

For taxpayers, stimulus checks are based on your adjusted gross income, or AGI, from your most recent tax return. There are several reasons you may find the IRS owes you a plus-up payment for your third stimulus check. Note that if you're owed any money from the first two stimulus checks, you'll need to claim it in your 2020 taxes as a Recovery Rebate Credit. The plus-up payment only applies to the third check. You may get a plus-up payment if:

  • The IRS calculated your third check based on 2019 taxes (or earlier), but you're owed more money based on your 2020 taxes.
  • You're a tax nonfiler, but you submitted new information in a 2020 tax form to let the IRS know about any qualified dependents that the agency may not know about.
  • Your first payment didn't include all your dependents, like a new baby.
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How to know if you're eligible for a plus-up payment

The IRS is automatically sending out plus-up payments for people it calculates should receive one. There are several ways to gauge whether you should expect a payment adjustment. We recommend being proactive about this one, so you aren't mistakenly leaving hundreds or thousands of dollars behind in case there's an issue receiving your plus-up money.

  • Know how much stimulus money you should expect. Compare that with how much you actually received. If there's a big difference, you may be owed a catch-up payment.
  • Check the IRS tracking tool to see if your payment information has changed. For example, you may see that another plus-up payment has been scheduled for you. We've asked the IRS for clarification.
  • If you received a stimulus payment electronically by direct deposit or a Direct Express card, periodically check your balance to see if a new payment has arrived.
  • If you got your stimulus check through the mail and think you may be owed a payment, you can use this free USPS tool to see when mail is coming your way -- including another stimulus check.
  • Keep your stimulus confirmation letter from the IRS. If you need to claim a plus-up payment in the future, you'll need this information on hand.

How much money could you expect?

It depends on the differences between your 2019 and 2020 taxes and which one the IRS used to calculate your third payment. For each new dependent you claimed for the first time in 2020, they could count toward more money. And dependents of any age count, including 17-year-olds and adult dependents. And if you earned less in 2020 than you did in 2019, you might also qualify for a plus-up payment, again, depending on which tax year the IRS had on hand when it figured your amount.

When will plus-up payments arrive? And for how long?

The IRS has said it's sending plus-up payments weekly. The payment schedule will be largely tied to the rate at which the IRS can process 2020 tax returns. The IRS is currently accepting 2020 tax returns through May 17, the new Tax Day deadline. (If you're expecting a tax refund that includes missing stimulus money from the first two stimulus checks, we especially recommend setting up direct deposit with the IRS if you don't already have it, so you'll get your tax refund back much sooner.)

There are several implications to this. For example, if you earned more in 2020 than in 2019, but the IRS uses your 2019 return and gives you more stimulus money than you might be eligible for, you won't have to return that money (more below). This is assuming you haven't filed your 2020 taxes. The IRS has between now and the Dec. 31 deadline for sending stimulus checks.

If you're owed a plus-up payment, you shouldn't have to file an amended tax return or do anything else to claim it, other than file your 2020 tax return as soon as possible.

Plus-up payments by the week (number of payments, amount)

March 29 Undisclosed Undisclosed
April 5 1 million $2 million
April 12 700,000 $1.2 billion

What should you do if your plus-up payment never arrives?

The IRS has until Dec. 31, 2021, to finish sending stimulus check payments, and that will include the catch-up payments for people who are still owed stimulus money. But if the automatic adjustment never arrives, what should you do?

If you know how much stimulus money you should expect, using our stimulus calculator as a baseline, and the amount the IRS tells you to expect differs greatly from the total the IRS said it gave you in a confirmation letter, you'll need to keep an eagle eye out for payment adjustments. 

If the extra money never arrives, you may need to file a claim, either later in 2021 (if the IRS opens up an adjustment window) or potentially a year from now on your 2021 tax return. This is much like the current Recovery Rebate Credit for missing stimulus check money from the first two rounds of stimulus payments.

We've asked the IRS for more information on how long it could take to send out all of these supplemental payments, and what to do if your plus-up payment never arrives. We'll update this story when we get more information. 

What if the IRS uses your 2019 tax return, but you earned more money in 2020?

If you qualify for the full third stimulus payment based on your 2019 taxes but don't qualify based on your 2020 taxes -- assuming the IRS used your 2019 return -- you won't have to pay the IRS back for that discrepancy. Here are situations where you would need to return money to the IRS.

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If your circumstances changed in 2020, you may be owed more stimulus money from the IRS.

Sarah Tew/CNET

What if the IRS still hasn't processed your 2019 taxes?

Due to pandemic-related delays, the IRS is still working its way through a backlog of paper tax returns from 2019. As of the end of January 2021, there were 6.7 million individual income tax returns for 2019 that had yet to be processed, according to the agency. These processing delays could be due to a number of things, including a mistake, missing information, or suspected identity theft or fraud. If the IRS contacts you for more information, you should get a letter. Resolving the problem then depends on how quickly and accurately you get back to the agency. 

However, the new bill specifies that a third stimulus check will be based on your 2019 or 2020 tax return -- not your 2018 one. The bill says: "On the basis of information available to the Secretary shall, on the basis of such information, determine the advance refund amount with respect to such individual."

If your 2019 tax return is still being processed, the best thing to do right now is to file your 2020 return electronically as soon as you can, according to Janet Holtzblatt, a senior fellow at the Urban-Brookings Tax Policy Center. But if the holdup in processing your 2019 return is due to a problem that also occurs on your 2020 return, your return may get slowed down -- which could delay your payment, Holtzblatt said. 

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What if you never get your third stimulus payment, or if any money is missing?

If you're eligible to receive a third stimulus check, but yours never arrives by direct deposit, paper checkEIP card or Direct Express card (if you receive SSI, SSDI or veterans benefits, for example), you'll likely have to take an additional step to claim that money. This happened to millions of people during the first and second round of payments for several reasons, including IRS errors, out-of-date banking information or addresses and nonfilers not taking an extra step to get their information to the IRS.

Much like with the first and second checks, you'll likely be able to claim any missing money from the third check owed to you or your dependents during tax season next year, 2022. However, the IRS has yet to say if there will be an opportunity to claim missing money in 2021 instead. The best thing to do right now to make sure your third check does arrive is to file your tax return as soon as possible, even if you don't usually have to file one.

For more, check out what you should and shouldn't do if you're still waiting for your third stimulus check to arrive and what we know so far about a potential fourth stimulus payment