If you received a stimulus check following the initial CARES Act last March, it’s likely you can expect to receive another stimulus check in the coming weeks. Since the stimulus check is a tax credit, it is not income and therefore is not taxable. 3 A refundable tax credit differs from a nonrefundable credit, which only applies to the amount of taxes you owe and is not available as a refund to you otherwise. The stimulus check is the same as a tax credit, and it is specifically an advanced refundable tax credit, meaning it is a refund allotted to you and is also sent in advance of the 2020 tax return. What Is the Difference Between a Stimulus Check and a Tax Credit? The IRS has created a special page dedicated to the Coronavirus and will be updating it with next steps on how to do this soon. Those who usually do not file a tax return, including low-income taxpayers, senior citizens and Social Security recipients, will need to file a simple tax return (but still will not owe tax) in order to receive their check. If I Usually Do Not File a Tax Return, How Can I Receive a Check? According to the IRS, this portal will provide important information including your payment status, payment type and whether additional information (including bank account information) is required. The IRS has created an online portal, called Get My Payment, where individuals can check the status of their stimulus check and learn what information the government may still need in order to issue a check. 2 What if the IRS Does Not Have My Direct Deposit Information? The IRS will use information from 2019 tax returns to calculate your payment amount and will send the payment to the bank account listed on the return. citizen and their noncitizen spouse are eligible to receive a stimulus check. In the new package, however, both the U.S. This refers to households in which a U.S. 1 Are Noncitizens Eligible?īack in March, the CARES Act did not allow families of mixed-status to receive a stimulus check. This means that individuals with an income higher than $87,000 are not eligible to receive a stimulus check and neither are joint filers with an income over $174,000. Individuals who make under $75,000 and couples who make under $150,000 are eligible for the full stimulus check.įor taxpayers with higher income, the amount is reduced by $5 for each $100 above $75,000, or $150,000 for couples - up to $87,000 or $174,000. In other words, taxpayers will be given an estimated amount based on their 2019 incomes, but could end up getting even more (albeit later) if their 2020 return shows they made less money than they made in the previous year. Important to note is that the initial amount paid will be based on either a taxpayer’s 2018 or 2019 income tax return (whichever is the latest return that the IRS has on file), but it will ultimately be ‘trued up’ if a taxpayer is owed money based on their actual 2020 income. The payment will begin to phase out for individuals with a 2018 or 2019 adjusted gross income of $75,000, couples with a $150,000 income and head of households with a $112,500 income. In addition, families will receive $600 per child under the age of 17. Just as before, taxpayers who qualify will receive a direct deposit of up to $600, and couples will receive $1,200. The Rundown on Stimulus Checks: Your Questions Answered As a reminder, here’s what you need to know about your second stimulus check. In an effort to ease the pandemic’s detrimental effects, the federal government has recently passed a second stimulus package as part of the larger National Defense Authorization Act.īeginning December 29, 2020, eligible individuals and families started receiving stimulus checks up to $600 per person. Nearly a year into the pandemic, individuals everywhere are experiencing emotional, physical and economical implications. However, this additional $1,400 stimulus check is still subject to further negotiation. The draft of the bill excludes individual taxpayers earning over $100,000 and joint filers making over $200,000 from getting a stimulus payment. This would be in addition to the recent $600 check authorized in December (as discussed below). The Democrats have proposed a new plan for a third round of $1,400 stimulus checks that is worth roughly half of President Biden’s $1.9 trillion coronavirus relief package. * (Note: This is a developing story, and we will continue to update the article as more information becomes available.)
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