Is there a way to un-file 2020 taxes now?

March 13, 2021 4:17 AM

We've had an awful year, with lots of catastrophes. One bright spot was the fact that filing taxes went smoothly and I filed 2020 taxes in February. We received our refund 10 days ago. I just learned that our 2020 earning amount is just enough to render us ineligible for the new stimulus. We received a specific windfall this year that put us over that limit: our 2019 taxes were significantly lower, and so will our 2021 taxes. We have crushing student loans and debt to relatives for our house purchase, so we'd really like to get the stimulus. Is it possible to un-file 2020 taxes so the government can rely on our 2019 taxes? Or can I re-file separately (my husband has the job and I stay at home, so I'd be eligible)? I called the IRS but they're too busy so not taking calls.
posted by anonymous to Work & Money (13 answers total)

You can definitely file an *amended* return. It probably won't give you the results you want, though (you will likely end up owing more in taxes than you would get from the stimulus payments). It's worth running the numbers, though. I think you probably missed out here - what a bummer.
posted by mskyle at 4:39 AM on March 13, 2021 [2 favorites]

I haven't done my 2020 taxes yet but my understanding is that the stimulus is classified as a refundable tax credit (or at least, the ones issued so far have been). This implies that, even if you had not yet filed your 2020 taxes and you receive the stimulus, you would have to pay it back when you do file and find that you're ineligible / above the income threshold. I am not a tax lawyer, etc.
posted by heatherlogan at 5:39 AM on March 13, 2021 [11 favorites]

Or can I re-file separately (my husband has the job and I stay at home, so I'd be eligible)?

TurboTax (and various other similar services) says no, unfortunately: "You can amend a return to change from married filling separate to married filing joint but not from married filing joint to married filing separate unless you do so prior to the original filling deadline without extensions. So, once you file a joint return you can not change it to a separate return if the filing deadline has already passed."
posted by teremala at 6:09 AM on March 13, 2021

@teremala: But... the filing deadline is April 15, so the OP can still file an amended return that changes it to married-filing-separately.
posted by alex1965 at 6:49 AM on March 13, 2021 [4 favorites]

Ah, sorry, yes, I got turned around on which year we were talking about vs the actual year. Carry on with that plan if there's no legal sense in which your joint income calculations could be stated more favorably, I suppose.
posted by teremala at 7:14 AM on March 13, 2021

(a) You've filed, you can't unfile, and even if you could and they sent you the stimulus check, you'd have to return the money once you did file, as laid out by heatherlogan above. (b) You can, until April 15, file an amended return as married/separately, which would get you one check rather than two. (c) All that said, talk to a tax advisor first, don't rely on random internet strangers or Googling.
posted by beagle at 7:36 AM on March 13, 2021

I don't think there's a way to unfile your taxes.

But my understanding is it's true that if you had not filed your 2020 taxes, they would have used your 2019 taxes to guess whether you were going to be eligible in 2020, and paid accordingly.

Filing your taxes in 2020 can cause you to receive more Recovery Rebate Credit if the guess using 2019 (or 2018!) numbers was wrong making the payments too low, but filing for 2020 can NOT cause you to have to repay/return the money if the guess was wrong in your favor, as several people above have said.

See the RRC worksheet in the 1040 instructions, page 58, line 20, where it says:

If zero or less, enter -0-. If line 19 is more than line 18, you don't have to pay back the difference.

posted by fritley at 7:56 AM on March 13, 2021 [3 favorites]

Married filing separately would most likely cost you. Also, amended will take a long time to get processed. Please have a tax advisor run these scenarios using your real financials.

Be thankful for the windfall! It sounds like you got more than most people would from the stimulus already.
posted by michaelh at 8:36 AM on March 13, 2021 [1 favorite]

I'd have to think the tax implication of your spouse having to pay the filing separately marginal rate instead of joint is probably bigger than a single stimulus payment. Of course I don't know the break down if income, particular the windfall you received. So I'd definitely run all the numbers in different scenarios being careful look at rules, or pay for an account if you're unsure.
posted by skynxnex at 9:38 AM on March 13, 2021 [1 favorite]

You do not have to pay back the stimulus if it was paid to you in error. The only time they were taking back payments is if they were sent to a deceased person.

If you don't qualify for this stimulus, you can't file any differently to qualify unless you omit the income and that is fraud.
posted by soelo at 6:33 PM on March 13, 2021

A point about filing separately is that you both have to itemize or not in the same way. You cannot itemize on one return and take the standard on the other. If you did not itemize, you will each get the standard deduction of 12,400.

You also cannot deduct student loan interest if you file separately.
posted by soelo at 6:45 PM on March 13, 2021

Some confusion here might be because "refundable tax credit" is a term of art speaking to whether a tax credit can drop your total tax owed for the year to below zero, resulting in not just a normal refund (like for pre-paying more than you ultimately owe), but rather an actual net positive payment from the government to you, after zeroing out your income tax liability completely. Most tax credits in the U.S. are "non-refundable," meaning they can bring your income tax liability to zero, but you can't earn money from them beyond that. The stimulus payments are one of the exceptions. (The phrase doesn't at all speak to whether or not you might have to pay back that tax credit under certain circumstances, and at least for the prior rounds of stimulus that wasn't the case -- barring fraud, at least.)
posted by nobody at 8:51 AM on March 14, 2021

Oh, wait -- here's actually potentially useful advice: It looks like the stimulus thresholds are based on "adjusted gross income" (AGI), which means that if you really are quite close to the threshold, you could theoretically (barring some limitations) contribute to certain eligible retirement accounts prior to April 15th (being careful to earmark those as 2020 contributions) and refile your taxes with the resulting new lower AGI, after which the stimulus should be included in your new refund.

The rules for how to do this get complicated pretty quickly (if you make above a certain amount, which you did last year), but it looks like you personally might be able to contribute up to 6,000 to an IRA, and if your husband happens to not have a retirement plan at work, you could each do so, adding up to potentially 12,000 off your AGI.

And/or: if your husband does have a retirement plan through work, it might be worth asking if they have a mechanism for allowing further 2020 401k contributions between January 1st and April 15th (which apparently could help subtract up to 19,500 from your AGI for the year, assuming you're willing/able to put that much of your windfall away for retirement).

In any case, it's surely worth checking with a professional before doing any of these, but this might point toward a truly available solution.
posted by nobody at 12:50 PM on March 14, 2021 [3 favorites]