Congress passed a $900 billion COVID-19 relief bill that includes direct stimulus payments to individuals and families. The bill was signed by the President on December 27.
Here’s a breakdown of what the bill entails.
How much will I get?
The bill allows up to $600 per adult, and $600 per qualifying child under age 17. A married couple with one child could get up to $1,800, for example. The exact amount you receive will be determined by your adjusted gross income (AGI) on your 2019 tax return.
Who is eligible for a stimulus check?
- Single filers with an AGI up to $75,000 in 2019 will receive the full $600 stimulus payment. For filers with an AGI greater than $75,000, the payments be reduced by $5 for every $100 of income, before phasing out at $87,000.
- Married couples filing jointly with an AGI up to $150,000 in 2019 will receive the full $1,200 stimulus payment. The same $5 per $100 phaseout applies here as well but tops out at $174,000.
- Heads of household with an AGI up to $112,500 in 2019 will be eligible for the full $600 stimulus payment. The $5 per $100 phaseout applies here and phases out at $124,500.
- Filers with qualifying children will receive $600 for every qualifying child under the age of 17 even if their income exceeds the limits above.
Who is not eligible for a stimulus check?
- Dependents. Individuals that can be claimed as a dependent are not eligible. For qualifying children under 17, the taxpayer who claims him/her will receive the stimulus payment.
- Taxpayers without an SSN or TIN. In order to be eligible for a stimulus check, you must have a social security number or taxpayer identification number.
- Individuals who died before the payment was issued.
- Nonresident aliens.
How soon will I get my check?
The bill doesn’t specify a date but instead says payments will be disbursed “as rapidly as possible.” Generally, taxpayers who e-filed or paid or received a refund through their bank account will receive their payments faster. For paper filers and those who did not use their bank accounts, a check will be mailed to you. The IRS set up a website for you to check the status of your check.
What if I didn’t file a tax return?
If you didn’t filed a 2019 tax return, or are a senior citizen, Social Security recipient or railroad retiree, the IRS will use information from the Social Security Administration, the Railroad Retirement Board and the Veterans Administration to determine the amount of your stimulus payment.
Do I have to repay the stimulus payment?
No, the stimulus payment is not a loan.
Are stimulus payments taxable?
No, stimulus payments are officially called refundable tax credits meaning they are not taxed. They also won’t have your eligibility for other programs such as Social Security.
If you have any questions regarding the COVID-19 relief bill or stimulus payments, contact us at email@example.com or schedule a call here.