STIMULUS PACKAGE 2020

So far we’ve been receiving emails and phone calls from our clients asking about their stimulus check.

As of right now the Cares act has been signed into law and these checks will start to be sent out within the next few weeks. Below is a link labeled stimulus refund calculator where you can get an estimate on what your stimulus check might look like.

STIMULUS REFUND CALCULATOR

I’ve also been asked by a few clients who’s income exceeds the $75,000-$150,000 AGI if they’re better off holding back on filing their 2019 income tax return. Yes, they would qualify for the full stimulus check, but this check is an advance on a 2020 tax credit. I’ve attached a Q.A. from the same source who is providing you with the calculator and as you can see there really isn’t a clear answer yet, but we’re assuming that if a credit has been issued and the recipient is deemed UN-qualified then there could be a reduction in the credit and maybe even a repayment that would be reported on the 2020 income tax return.

Unfortunately, we’re not 100% sure on how that would work out, but we’re recommending that our clients who have not filed their 2019 reach out to us and provide us with their updated direct deposit info so that we can make sure that the IRS is able to properly estimate the 2020 tax credit. If you do not have the direct deposit information on file with the IRS then they will send you a check or the credit will need to be applied on the 2020 income tax return.

If I Wait to File My 2019 Return to Get a Bigger Check, Will I Have to Pay Back the Difference Later?

Let’s say you wait to file your 2019 return because your stimulus check will be $100 more if the IRS bases your payment on your 2018 return. Will you get to keep that additional $100?

That’s still an open question. The way the law is written, the checks that will be sent now are actually just advanced payments of a new refundable tax credit for the 2020 tax year. We don’t know yet how the IRS will treat stimulus payments that are more than the 2020 tax credit amount. (If the check is less than the authorized credit, you’ll get the difference when you file your 2020 return.)

On the one hand, the IRS is authorized to issue regulations or guidance “deemed appropriate to avoid allowing multiple credits or rebates to a taxpayer.” They might use this authority to get the $100 back (e.g., through an additional tax on your 2020 tax return). On the other hand, there was no mechanism for giving back any “extra” stimulus check money when similar payments were issued back in 2008. But, then again, all the 2008 stimulus checks were based on the same year’s tax return.

https://www.kiplinger.com/article/spending/T063-C000-S001-stimulus-checks-2020-how-much-when-and-other-faqs.html

Will “Nonresident Aliens” Get a Check?

Nonresident aliens are not eligible to receive a stimulus check. Generally, you are a nonresident alien if you’re not a U.S. citizen, you don’t have a green card, and you are not physically present in the U.S. for the required amount of time. For more information on nonresident alien status, see IRS Publication 519.

If I Haven’t Filed My 2019 Return Yet, Should I Do That Now or Wait?

There’s an opportunity to manipulate the amount of your stimulus check if you haven’t already filed your 2019 return. For some people, you could end up with a larger check depending on whether you file your 2019 return right away or wait to file until after you get your stimulus payment. To find out which is better, use the Stimulus Check Calculator to run the numbers using both your 2018 and projected 2019 returns (a best guess for 2019 will do in a pinch). If you get a higher amount using your 2018 return, wait to file. If the amount is better using 2019 numbers, then file as soon as you can.

Will Young Adults Who Live with Their Parents Get a Check?

Even if they have a job or are a student, young adults who still live at home will not get a check if they can be claimed as a dependent on anyone else’s tax return (whether or not they are actually claimed as a dependent on someone’s return). We’re mainly talking about children who are 17 or 18 years old, or college students who are 23 or younger at the end of the year. The IRS will look at your 2019 or 2018 tax return to determine if someone could claim you as a dependent.

Will “Nonresident Aliens” Get a Check?

Nonresident aliens are not eligible to receive a stimulus check. Generally, you are a nonresident alien if you’re not a U.S. citizen, you don’t have a green card, and you are not physically present in the U.S. for the required amount of time. For more information on nonresident alien status, see IRS Publication 519.

(Trusts and estates are not eligible for stimulus checks, either.)

Do I Have to Have a Social Security Number to Get a Check?

Yes, you must have a Social Security number to receive an economic stimulus check. Your spouse and any child you’re receiving $500 for must also have a social security number. An individual taxpayer identification number (ITIN) is not good enough.

SEE ALSO: 15 Safe Ways to Earn Extra Cash in the Age of the Coronavirus

There are two exceptions to this rule. First, an adopted child can have an adoption taxpayer identification number (ATIN) instead of a Social Security number. Second, for married members of the U.S. armed forces, only one spouse needs to have a Social Security number.

Will the IRS Take My Check If I Owe Back Taxes?

Stimulus money is generally not subject to reduction or offset to pay back taxes or other debts owed to the federal government.

What If My Check Doesn’t Arrive?

Within 15 days of mailing your check (or directly depositing it into your bank account), you will receive a notice in the mail indicating the method of payment, the amount of payment, and an IRS phone number to call if you didn’t receive your payment.

Both the payment (paper check) and notice will be mailed to your last known address the IRS has on file. If you have recently moved, you should file a Form 8822 with the IRS and a change of address notice with the U.S. Postal Service. This will ensure correspondence and payments from the IRS will be sent to your new address.

https://finance.yahoo.com/news/2020-stimulus-check-much-other-124848534.html

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