When will I get my check? Checks are supposed to be produced within 3 weeks. Mnuchin has hinted they will come in April, but it’s been suggested that could take up to two months. If your last tax refund was issued via direct deposit, then the rebate will be paid using the same method.
How big will my check be? Checks will be $1,200 per adult – or $2,400 for married couples filing jointly – and an additional $500 per child.
Are there income limits on checks? The amount of the checks would start to phaseout for those earning more than $75,000 ($150,000 for joint returns and $112,500 for heads of household). This is adjusted gross income (AGI), not taxable income – so before your standard or itemized deductions. You’ll see your number on line 8(b) of your form 1040:
Wait, how does a phaseout work? Phaseout means that the benefit goes down as income goes up. In this case, for every $100 of income above those thresholds, your check will drop by $5. So, if you are a single filer earning $75,100, your check will be $1,195 ($1,200-$5). If you are a single filer earning $85,000, your check will be $700 ($1,200-$500). If you do the quick math on that, it means that you’ll phaseout completely (meaning that you’ll get nothing) once you hit $99,000 as a single filer, $198,000 as a married couple filing jointly, or $136,500 for heads of household.
What about limits on kids? There are no limits on the number of children that qualify. The definition of child will be the same as for the child tax credit (you’ll find the age and other requirements at that link).
Will I need a Social Security Number to get a check? Yes. Or in the alternative, an adoption taxpayer identification number. Ditto for spouses and kids.
So how does this work? Do I need to file anything to get my check? Technically, the checks are advances of refundable credits. Treasury will advance your check based on your most recently filed tax return (2018 or 2019 tax return). If you haven’t filed a tax return, the bill allows Treasury to use the information on your 2019 Form SSA-1099, Social Security Benefit Statement, Form RRB-1099, Social Security Equivalent Benefit Statement.
Okay, I don’t understand. What is a refundable tax credit? A refundable credit means that you can take advantage of the credit even if you do not owe any tax. Unlike with a nonrefundable credit, if you don’t have any tax liability, the “extra” credit is not lost but is instead refunded to you.
In this case, the stimulus check acts like a refund that you get in advance based on your 2020 income. That’s confusing because you don’t know how much you’re going to earn in 2020, but it’s why the IRS is using earlier returns. But this advance payment on the credit does not affect your “normal” tax refund for 2020: you won’t lose out on your expected tax refund for 2020 with the check.
What if I don’t get the right amount? When you file your 2020 tax return, the IRS should compare numbers. If you should have gotten a check and didn’t, or if you should have gotten more than you did because the IRS didn’t know something important (like you have a kid), you should get more money. If the numbers on your 2020 tax return suggest that you got more than you should because of your income, you should not have to pay it back. Don’t worry: most taxpayers should get just the right amount.
Is my check taxable? No. This is not taxable income.
What if I am expecting a refund for the 2019 tax year? Your 2019 refund will not be affected by the stimulus check.
What if I’ve moved or don’t receive my payment? Under the law, the Treasury must send notice of the payment by mail to your last known address. The notice will include how the payment was made and the amount of the payment. The notice will also include a phone number for the appropriate point of contact at the Internal Revenue Service (IRS) if you didn’t receive the payment. Usually, you’d do that on your tax return, but you can also submit a federal form 8822, Change of Address (downloads as a PDF). It generally takes four to six weeks to process a change of address.
What about retired and disabled folks? Retired seniors, veterans, and other disabled persons are eligible so long as they meet the other criteria (Social Security numbers, income thresholds, etc.). If you depend on Social Security but normally don’t file a tax return, you do not need to file a tax return to get the check. The bill directs the Treasury to rely on your SSA-1099 form (or RRB equivalent) to figure and send your check.
What about those on government benefits? And those with no income? Yes, eligible folks include those with no income, as well as those whose income comes entirely from non-taxable means-tested benefit programs, such as SSI benefits.
Will I still get the check if I owe the IRS some money? Yes. If your refund would normally be seized to pay a tax debt, that shouldn’t happen here. Shouldn’t. Assuming it works as planned.
Do college students get anything? Not if anyone claims them as a dependent on a tax return. Usually, students under age 24 are dependents in the eyes of the taxing authorities if a parent pays for at least half of their expenses.
What if my recent income made me ineligible, but I anticipate being eligible because of a loss of income in 2020? Do I get a payment? The plan does not help people in that circumstance now, but you may benefit once you file your 2020 taxes. That’s because the payment is technically an advance on a tax credit that is available for the entire year. So it will depend on how much you earn.
And there are many other provisions in the legislation. You may be able to file for unemployment or for one of the new loans for small-business owners or sole proprietors.
Small Business and Self-Employed Disaster Relief Loans
These 6 pdf documents should be almost all you need to apply for the Disaster Relief Loan. Begin with Business Loan Application (SBA Form 5). This form has instructions in the document that will call for the other forms, depending on your situation. Feel free to download these fillable pdf files, and share them with others who need help.
If you need help with preparing your tax returns, financial documents, or the loan forms, then please contact us for assistance. We will have a fee structure, based on the amount of work required to help you apply for your loan.