Weeks after Congress passed the whopping two Trillion dollar CARES act, it is finally time for U.S. residents to start receiving their cut. And while businesses across the country are scurrying to figure out the loan application processes, there seems to be no major hoops to jump through for those who are eligible for the stimulus check.
Who’s getting it?
If you are an individual with an adjusted gross income (AGI)* of 75,000 or less, you will be eligible for the full $1,200. If you are a married couple with a combined income of $112,500 or less, you will be eligible for the full $2,400. If your income is higher than the aforementioned AGI, you will receive an adjusted check, up until the income threshold of $99,000 for singles and $198,000 if filing jointly as a married couple.
There is, however, a big exception. If you are someone who another taxpayer (a parent or guardian) can and did list as a dependent, you are NOT eligible to receive this money. Someone is eligible to list you as a dependent if they pay 50% or more of your expenses. So if you were listed as a dependent on your parent’s 2018 or 2019 taxes (depending which were filled latest) you will most likely not be receiving a check.
There is an additional $500 which will be distributed per child, for every child under the age of 17.
How will it be distributed?
The “How” has been a big question for people; however, the answer is fairly simple. If you have filed your taxes in the last year or two, you most likely have done a direct deposit for your return. In this case, the IRS has your bank information on file and will be direct depositing the money to this account.
If you chose to do a mail-in return for your taxes, the IRS has an address on file for you and will be mailing out the checks. These checks will be mailed out in waves and those who receive the checks via mail may experience delays.
When can I expect it?
Most eligible residents for whom the IRS has bank account information will receive their direct deposit starting on April 15th.
What if I don’t file for taxes?
If you have not filed your taxes due to having low income, and you were not listed as a dependent of a different taxpayer, the IRS has created a portal for you to enter in your information.
Non-filers, see more information here: https://www.irs.gov/coronavirus/non-filers-enter-payment-info-here
What if my bank-account or information has changed?
The IRS is currently working on a portal they plan to have rolled out in mid-April (hopefully, in the next week or so). This portal will allow eligible residents to update their bank account information, as well as their address. This portal will also allow you to review the status of your stimulus check.
More information on this portal can be found here: https://www.irs.gov/coronavirus/economic-impact-payments
Will I have to pay it back?
There has been a lot of speculation on whether this check will need to be paid back. In short, the answer is no. The bill allowing for these checks to be released to the public has language which suggests it is an advance on the 2020 tax return. This is true and it is done in a way to allow for speedier checks to be made out to the public.
Based on your taxable income each year you owe a certain amount in taxes, of which you get some amount back in the form of a refund. This bill reduces your 2020 tax liability, or the amount of taxes you owe for 2020, by $1,200, allowing for you to be credited that money in your tax refund. However, since the checks are being distributed now, ahead of the 2020 filling date (which will occur in 2021), that credit will be canceled out. To summarize, the money you are receiving now will not need to be returned and will not affect your potential 2020 refund (1). Additionally, unlike the unemployment relief, this stimulus check is not taxable (2).
The $1,200 is fully yours.
Adjusted Gross Income (AGI): Your taxable income minus any deductions (certain retirement plans and Health Savings Accounts).
Copy edited by Megan Lachman