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4 - Erroneous AbatementThe timely filed TC 150 return for TY 2018 is determined to be a nullity. The valid taxpayer filed a return reporting tax of $.00 and withholding of $2,500 which posted as a TC 976. Form 14039 is included with the return. The ASED for the valid return is expired. Based on the original return, the account shows TC 150 tax of $5,000, and withholding of $6,000. A CP 2000 proposing a tax increase of $2,000 based on unreported income is issued to the valid taxpayer’s last known

Economic Impact Payment (EIP) and Recovery Rebate Credit (RRC) - General

Internal Revenue Manual Part 25. Special Topics · 2026-10-03 edition · updated 2026-10-04 · United States

The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was signed into law on March 27, 2020. IRC 6428 provides eligible individuals with a recovery rebate credit (RRC) for tax year 2020 that taxpayers may receive as an advance payment. Advance payments of the RRC are referred to as Economic Impact Payments (EIPs).

The RRC for tax year 2020 was increased, and a second Economic Impact Payment (EIP) was included as part of H.R. 133, Consolidated Appropriations Act, 2021.

The American Rescue Plan Act (ARPA) of 2021 was enacted on March 11, 2021. It provides eligible individuals with a recovery rebate credit for tax year 2021 that taxpayers may receive as an advance payment (EIP 3).

EIPs do not accrue credit interest.

Systemic issuance of EIP 1 began with payments made via direct deposit on April 10, 2020. Paper checks were issued beginning April 24, 2020. Pre-paid debit cards were issued beginning May 18, 2020, and are identified by a TC 971 AC 199 with MISC "BFS DEBIT" . Advance payments of EIP 1 were not allowed after December 31, 2020. EIP 1 was subject to offset for child support obligations, only.

Systemic issuance of EIP 2 began with payments made via direct deposit on January 4, 2021 followed by paper checks and pre-paid debit cards issued later in the month. Refunds of these payments are issued from the tax year 2020 module (tax year 202101 - 202111 for fiscal year filers). EIP 2 was not subject to offset. If EIP 2 was not issued by January 15, 2021, the taxpayer must file a tax year 2020 return to claim the 2020 RRC, if eligible

Issuance of EIP 3 began in March 2021. Refunds of these payments are issued from the tax year 2021 module (tax year 202201 – 202211 for fiscal year filers). EIP 3 is not subject to offset. If EIP 3 has not been calculated by December 31, 2021, the taxpayer must file a tax year 2021 return to claim the 2021 RRC, if eligible.

The amount of the EIP 1 is based on the tax year 2019 return, if filed. If a tax year 2019 return has not been processed, tax year 2018 return information is used. EIP 2 is based on the tax year 2019 return, if filed. EIP 3 is based on the tax year 2020 return, if filed. If a tax year 2020 return has not been processed, tax year 2019 return information is used. Systemic computation of EIP 3 will take into consideration updated AGI (as adjusted) but does not consider changes to filing status or child tax credit. If the EIP 3 was based on a 2019 return, when a 2020 return is filed, an additional payment will be issued if the amount of EIP 3 is more when computed with the 2020 tax return information. The deadline for additional payments is 90 days after the return due date (September 1, 2021) for calendar year filers. Taxpayers who have not filed a tax return for either 2019 or 2018 will not receive an EIP 1, taxpayers who have not filed a tax return for 2019 will not receive an EIP 2, and taxpayers who have not filed a tax return for either 2020 or 2019 will not receive an EIP 3, unless an exception applies:

Of those who are not required to file returns for 2019 or 2018, individuals who received Social Security retirement benefits, Social Security disability income (SSDI), Social Security survivor benefits, Railroad Retirement benefits (RRB), Railroad Retirement survivor benefits, Veterans Administration (VA) Compensation and Pension (C&P) benefits in 2019 received their EIPs based on Federal benefit payment information for 2019.

Individuals who did not have a filing requirement for tax year 2018, 2019, and/or 2020 may have used the Non-Filers Tool available on IRS.gov to receive an EIP by providing their personal information and selecting a payment type of direct deposit or paper check. Taxpayers who have been issued an Identity Protection Personal Identification Number (IP PIN) must enter their IP PIN on the tool.

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▸Contents — Internal Revenue Manual Part 25. Special Topics
Internal Revenue Manual Part 25. Special Topics

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