The CARES Act, calls for individuals to get $1,200 payments from the government. Here are answers to some of the most common questions.
Who qualifies for the stimulus money and how much is the payment?
The short answer – most everyone will qualify for some amount of money. You must have a Social Security number and not be a dependent of someone else. Here are the specifics:
- Individuals (aka Single filing status) who have an adjusted gross income (AGI) of $75,000 or less are eligible to receive the full payment amount, which is $1,200. That payment reduces by $5 for every $100 in income above $75,000. Reduced payments will go out to individuals who earn up to $99,000 a year. If you earn more than $99,000, you will not receive a payment.
- Married couples with an AGI of $150,000 or less are eligible to receive a full payment amount of $2,400. That payment also reduces by $5 for every $100 over the $150,000 mark for couples who earn up to $198,000. Those who have an AGI that’s more than $198,000 are not eligible to receive a payment.
- Head of Household filers who have an AGI of up to $112,500 are eligible to receive a $1,200 payment. Reduced payments will be sent to Head of Household filers with an AGI of up to $136,500. Those who earn more than $136,500 are not eligible to receive a payment.
Check line 8b on your 2019 1040 federal tax return to find your AGI.
If you haven’t filed your 2019 return yet and need to refer to your 2018 AGI, check line 7 on Form 1040.
If you have children under the age of 17, you may qualify to receive an extra $500 for each one. Unfortunately, if your child is over the age of 17 you will not qualify for extra money.
My child is in college, do I get anything extra?
Unfortunately, no. To qualify for the extra $500 your child must be younger than age 17.
And, your high school or college student who is 17 or older cannot file their own tax return to receive a stimulus payment if they qualify to be claimed as a dependent on your return. That’s true even if you choose not to claim them. If they pass the dependent test, they are always considered a dependent.
What about people who are on Social Security or who don’t earn an income?
If you are on Social Security or otherwise don’t earn an income, you still qualify for the relief payments. That is as long as your total income does not exceed the income thresholds mentioned above. You must have a social security number.
How do I get the payment? Do I need to do anything?
The payments will come automatically. If you already filed your 2019 tax return, the federal government already has the most up-to-date information needed to accurately assess how much your payment should be and send it to you.
If you haven’t completed your 2019 return, file as you can so you receive the most accurate payment. Filing now also helps to ensure your bank account and home address information is up to date so there is no question about where the money should be sent.
If you don’t file your return by the time the payments go out, your 2018 AGI will be used to determine how much you are due. If your information has not changed since you filed your 2018 taxes, the government has your most current information.
If you do not file a tax return, but receive Social Security benefits or receive Disability, the information needed to accurately assess your payment and send it to you is collected from what’s on file with the Social Security Administration (SSA).
When will I receive my money?
Treasury Secretary Steven Munchin initially stated his goal was to get the first payments issued the week of April 6. Many experts, however, have stated that may be too ambitious of a goal. They speculate it will likely be later in April.
In 2008, the stimulus payments went out in batches. It took roughly eight weeks for everyone to receive their checks.
How will I receive it?
To promote social distancing and get the money in the hands of Americans as fast as possible, the federal government prefers to send the payments via direct deposit.
If you don’t have a direct deposit option, however, other solutions are available. Paper checks will be sent if necessary.
Will I be notified?
The Treasury will send you a notice of the payment by mail to your last known address. It will list how the payment was made plus the amount deposited.
If you don’t receive the payment, the notice will also include a phone number for the appropriate point of contact at the IRS. Until you receive your payment, hold onto the notice.
Is this money taxable?
No, the payments are not taxable.
Will this affect my 2019 refund?
No, these stimulus payments will not change your 2019 refund or impact your anticipated 2020 refund.
What if I owe money to the IRS for prior years?
Any IRS liabilities you currently have, including any back taxes, won’t be taken out of this money. You’ll still receive your full payment.
For the official notices, visit the IRS’ Coronavirus Tax Relief page.