Back to Blog - Tax News For You

Tax Information

Published May 17, 2026

Featured image for Tax Information

How does the Economic Impact (stimulus) Payment (EIP) affect my return?
What is the EIP? The EIP was a payment of up to $1,200 ($2,400 for married couples), plus an additional $500 for each qualifying child paid to tax filers in 2020. Tax filers with adjusted gross income (AGI) up to $75,000 ($150,000 for married filing joint returns) should have received the full payment in 2020. Filers with income above those amounts, the payment amount was reduced by $5 for each $100 above the threshold. These payments are not taxable.
 

Do I have to report the EIP on my tax return?
Yes, if you qualify for the Recovery Rebate Credit, we'll ask you for the amount of EIP you received last year and calculate the credit for you.
 

How do I know how much EIP I received last year?
 

What if I didn't get my EIP?
You can still receive your EIP on your 2020 tax return through the Recovery Rebate Credit. If you qualify for a larger EIP amount based on your 2020 tax return the Recovery Rebate Credit will increase your refund or decrease the amount you owe. The amount of your Recovery Rebate Credit is the amount of EIP you qualify for minus the amount of EIP you actually received. For more information see What is the Recovery Rebate Credit?
 

Is my EIP taxable?
No.
 

How does deferring payroll taxes affect my tax return?
Due to COVID-19, the IRS is allowing employees to defer paying Social Security tax that usually comes out of their paychecks. If your employer allowed you to defer these payments, the amount deferred must be withheld from your paychecks between January 1, 2021 and April 30, 2021, or interest and penalties will apply. If you have further questions, you should talk with your employer. This deferral will not affect your tax return.
 

How does being furloughed affect my tax return?
If you were furloughed in 2020, you may have received unemployment benefits, which you would report on your 2020 tax return.
 

How do unemployment benefits affect my tax return?
If you received unemployment benefits, you may receive a Form 1099-G from your state in January 2021. If you don't receive a Form 1099-G for your unemployment income, you can check the state website to see if it's available electronically. Unemployment benefits are taxable. You'll enter the information from your Form 1099-G and we'll calculate any applicable tax.
 

How does mortgage forbearance affect my tax return?
Most people take the Standard Deduction so there would be no effect on their tax return. If you do itemize your deductions, mortgage forbearance could mean you paid less interest in 2020. Paying less mortgage interest leads to lower Itemized Deductions. If you take the home office deduction for your business, mortgage forbearance could also mean lower office expenses and a lower home office deduction.
 

Can I deduct my moving expenses?
The moving expenses deduction applies only to active duty members of the Armed Forces who are moving due to a permanent change in station. See Moving Expenses for more information.
 

How will taking money out of my retirement accounts affect my tax return? If you qualify to take money out of your retirement account due to COVID-19, you can avoid the 10% additional tax for those taking out money before age 59 1/2 (up to $100,000). You would still have to pay regular tax on that money. See the IRS website  for more information.

Share this post

Facebook X / Twitter

Frequently Asked Questions

Find quick answers to common tax questions.

Do you have earned income? To qualify for the EIC, you must have some earned income, such as wages.
 

Do you have investment income over $10,000? If your investment income is over $10,000, then you will not qualify for the EIC.
 

Did you have a child live with you for more than 6 months last year? On the Dependent Information screen where it asks the number of months your child lived with you, if you selected less than 6 months, you will not qualify for the Earned Income Credit for that child.
 

Another common reason for not qualifying for the EIC is if you have no qualifying children for the EIC and if you are younger than age 19 (24 if you were a student, or 18 if you were a qualified foster youth or homeless youth). You must be at least that old to get the EIC if you do not have any kids.
 

Also double check how you answered the four Earned Income Credit (EIC) questions.


  1. The first question asks if you  and your spouse (if married) have valid Social Security numbers. The default answer is Yes. If you choose No, the EIC is      not allowed.
  2. The second question asks if your home was in the United States for more than half the year last year.      The default answer is Yes. If you choose No, the EIC is not allowed.
  3. The third question asks if the      IRS has sent you a notice saying that you cannot claim the EIC in 2021. The default answer is No. If you choose Yes, the EIC is not allowed.
  4. The fourth question asks if you      were a nonresident alien for any part of 2021. The default is No. If you choose Yes, the EIC is not allowed.

The American Rescue Plan increased the amount of the Child Tax Credit and made it refundable for most people with children.
 

It also made half of the credit payable up front before filing a 2021 tax return. The IRS started sending payments to people based on the number of dependents on their 2020 or 2019 tax return. These payments started going out in July of 2021 and were sent each month through December of 2021.
 

If you received advance Child Tax Credit payments, you can enter the information on the Child Tax Credit Advance Payments screen and we'll use that information to calculate the remaining amount of your Child Tax Credit.
 

Any advance Child Tax Credit payments you received will reduce the amount of the Child Tax Credit you can take when you file your return. This is because you already received that portion of the Child Tax Credit before filing your return.
 

In some cases, you may need to repay some of the advance Child Tax Credit payments if the advance is more than the credit you qualify for when you file your return.

New for 2021: The American Rescue Plan expanded the Child Tax Credit for 2021, increasing the amount of the credit and making it refundable for most people. The IRS also made advance Child Tax Credit payments from July through December of 2021.
 

If you lived in the United States for more than six months or were a bona fide resident of Puerto Rico, you may qualify for the Refundable Child Tax Credit.
 

I you lived outside the United States and Puerto Rico, you may still qualify for the Nonrefundable Child Tax Credit.
 

Whether or not you lived in the United States, there's also a Credit for Other Dependents available for dependents who don't qualify for the Child Tax Credit.
 

Any advance Child Tax Credit payments you received will reduce the amount of the Child Tax Credit you'll take when you file your tax return. This is because you already received that portion of the Child Tax Credit from July through December of 2021, prior to filing your tax return.
 

The Child Tax Credit calculates and shows on Schedule 8812.