Thursday, April 2, 2020

Coronavirus Stimulus Checks

This is the post everyone wants to read.
How much am I getting and what do I need to do?

For most people, the answer is $1200 per taxpayer and spouse (each) and $500 for each dependent under age 17 and you don't need to do anything. Specifically, if you filed a 2019 tax return, made less than $75,000 filing Single or Married Filing Separately, $112,500 Head of Household, $150,000 Married Filing Jointly, and had direct deposit to an account that is still active, you will be getting a deposit in short order and don't need to do anything. If the last tax return you filed was 2018, and the above limits were met, you also will get the payment and don't need to do anything.

Who won't get a check:
People 17 or older who are claimed as a dependent.
Single or Married Filing Separately taxpayers who made more than $99,000 and no children under 17.
Head of Household taxpayers who made more than $136,500 and had no children under 17.
Married Filing Joint taxpayers who made over $198,000 and had no children under 17.

If you don't meet the criteria of the previous two paragraphs, use the calculator from H&R Block to see what you get:

Who needs to do something:
People who did not provide direct deposit information on their latest tax return. This includes people who owed, regardless of if they used direct debit. The IRS has provided a portal for updating direct deposit information to get your check faster, otherwise it can take up to TWENTY weeks to get your check. The IRS will prioritize lower incomes for check mailing. The "Get My Payment" portal is prominently displayed on On 5/12, the IRS said filers had until noon on 5/13 to update direct deposit information to avoid getting a check. I assume this does not apply to people who filed in the last couple of weeks.
People who did not file a 2018 or 2019 tax return. File a return as soon as possible to get your tax return unless you receive Social Security and have it direct deposited AND you have no dependents and your spouse also receives Social Security. If not, you might want to file a "simple" return which the IRS says to do using $1 of interest labelled as "Stimulus Payment" as if it was received on a 1099INT. Click HERE for instructions.
People who filed a 2018 tax return and made too much money to qualify, or who have kids born in 2019. File a 2019 tax return to make sure you get the full amount of the check.
People who have closed or changed the bank account to which their last tax return was directed: The IRS says it will provide a portal for updating direct deposit information. I will provide details when the IRS provides it.
People without a bank account who have moved: Update your address with the IRS using Form 8822 ASAP!

What if you aren't required to file and don't receive Social Security: You might want to file a "simple" return which the IRS says to do using $1 of interest labelled as "Stimulus Payment" as if it was received on a 1099INT. I will have instructions for this in a separate post shortly...check the Master Index to find it. Alternatively, you might qualify to file a tax return if you have a W-2. In this case, get on it and file. I believe H&R Block is planning on filing these for free, even using an office (via drop-off or online approval in most cases). If you have only non-taxable income such as VA disability, you need to file a "simple" tax return. Click HERE for instructions.

What to do if you owe for 2019 and haven't filed: File your tax return ASAP and then use the forthcoming portal to proved direct deposit information to the IRS. This will ensure your stimulus payment is dropped to that account and will be available to cover your balance due (or to spend).

What happens if I don't file a 2018 or 2019 tax return, or made too much money on the latest filed tax return to qualify? The payment is truly based on your 2020 tax return, so if you qualify for a payment but didn't get it (or qualify for a larger one) it will be provided on your 2020 tax return.

Is the payment taxable? Do I have to pay it back? What if I make more money in 2020 such that I shouldn't have qualified? The payment IS an advance on your 2020 tax return but the amount is from a brand NEW credit that increases your 2020 tax return. It is not taxable, it does not have to be paid back. I'm not 100% certain, but, every other time they did this, if you qualify for a bigger payment on your 2020 tax return, you get the extra. If you deserve less, they let it go.

The IRS will send you a letter detailing the amount you should have received and how it was calculated.

Weird tricks:
A child over 17 on your tax return gets you $500. Filing independently they could get $1200.
Filing separately if one person has a big income and the other doesn't could get you a stimulus check when otherwise not entitled due to income, but will probably f**k up your tax return.
If your 2018 tax return met the above requirements and your 2019 doesn't, and you haven't filed 2019 yet, you should wait to file until after you get your stimulus payment.

Scams: No one is going to call or email you requesting you provide direct deposit information, personal information or have you pay money upfront to get the payment. The scams haven't started...but they will.

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