The IRS began depositing coronavirus stimulus checks this week but many still have questions about the payments.
Here’s what you need to know.
How much will I receive?
Individuals reporting a gross adjusted income up to $75,000 a year will be eligible to receive a $1,200 check. Check amounts decline for reported incomes over $75,000. No checks will be issued for individuals earning $99,000 or more.
Married couples reporting a gross adjusted income up to $150,000 will receive $2,400. Those couples reporting a combined income of $198,000 or more will not receive relief checks.
Heads of household will receive $1,200 if they earn up to $112,500.
Additionally, heads of households and married couples will receive $500 per child under 17.
If your adjusted gross income exceeds the baseline income amounts, you can use Tax Foundation’s CARES Act Rebate Calculator to get a better idea of how much you qualify for.
Will I be taxed on the money I receive?
The stimulus checks are not taxable income.
Will I have to pay back the money?
Payments are being issued based on your 2018 and/or2019 tax returns so assuming the information you reported is correct, you will not have to repay anything.
Presumably, if your 2020 adjusted gross income is lower than previous years causing you to qualify for a larger you may be eligible for any remaining rebate credit, they were not able to claim using their 2019 or 2018 return.
Some of you who have been able to keep working during the shutdown may be concerned that you will be penalized if you make more than you did in previous years. Rest assured does not appear to be the case. According to Money “anyone who no longer qualifies will not get their money clawed back.”
What if I have not filed my taxes for 2019?
The IRS will look at your 2018 tax return to check for rebate eligibility. If you are expecting a refund, you are encouraged to file your 2019 return sooner rather than later.
What if my 2019 income makes me ineligible for a stimulus check but I have since lost my job?
Unfortunately, that may disqualify you from receiving relief funds right now. If your 2020 income falls within the guidelines outlined above, any remaining credit will be applied when you file your 2020 return.
When will I get my check?
According to the U.S. Treasury Department many Americans should receive their deposits by Wednesday, April 15. Otherwise, most Americans should expect them within the next two weeks.”
If you still receive your tax refunds via paper check, expect to wait much, much longer. If you want to receive it with the rest of America, register your bank information on the IRS’s online portal.
What do I have to?
If you filed your tax return in 2018 or 2019 and the IRS has your banking information, you will receive a payment automatically.
It is those who are not required to file a return or those that have not filed a 2018 or 2019 return who need to act. I also recommend registering your bank information on the IRS’s online portal. This will put money in your hand much faster.
What if I don’t want to receive a stimulus check?
Believe it or not, I have heard people say that they don’t want to receive a stimulus check. Most were concerned they would have to pay it back, but others are standing on personal principle. Unfortunately, there is currently no way to opt out of receiving the check.
If your reason for not wanting the relief check is fear of having to repay it; current guidance indicates that will not be the case. If your reason for not wanting the relief check has to do with personal beliefs, you have a couple of options. You could tear up the check or you could donate the money to a person in need or a worthy cause. There are plenty of both.
Where did this information come from?
Like the information provided on the Economic Injury Disaster Loan, the Paycheck Protection Program, and tax incentives, the details of this relief program are still evolving. I have based my article on information gathered from HR 748 CARES ACT itself, the U.S Treasury Department, and from discussions held with industry experts either in person, online, or via webinars.
As always, I encourage you to do your own homework and talk to your own experts.