Economic Impact Payments, i.e. Stimulus Checks, COVID-19 payments, recovery rebates
We mentioned this in a previous newsletter, and we're all excited for a little economic relief with the stimulus checks especially with so many of us out of work, many of us REALLY need this. There's still some questions surrounding this topic.
Am I eligible? Do I get it? How much? and When will I get it and how?
Check out the IRS's FAQs on this topic
The government will send out checks to those who filed their 2018 and 2019 taxes. If you opted for direct deposit on your last return, whether that be your 2018 if you haven't filed your 2019 or your 2019 return, then they'll deposit the stimulus check right into that account.
The IRS began releasing payments (direct deposit) as early as last week and will continue to do so in the coming weeks. While we're not certain who's getting them first, but if we were to guess, it would be to those who have already filed their taxes and have direct deposit. The second round would be those who would be getting paper checks mailed to them. Some may even get them as late as September or even December if they go on an extension to October 15th.
I didn't file in 2018 OR 2019! What do I do?!?!
You might have not needed to file a return such as those whose gross income (before taxes) is less than $12,200 for individuals or $24,400 for married filing jointly. The other stipulation of why you might have not needed to file a return is because your only source of income is from Social Security retirement (SSI), disability (SSDI), railroad retirement or survivor benefits. You'll need to fill out a simple application with the IRS so they know where to send your payment.
NOTE: If you have dependents (child/ren), an extra step is needed to add $500 per child onto their automatic payment of $1,200/$2,400 if they didn't file a tax return in 2018 or 2019.
For more information on this process, CLICK HERE.
I no longer have the checking/savings account I used with my last return. What do I do?
They'll mail your payment to the last known address.
But I don't live there anymore.
You should visit https://www.irs.gov/coronavirus/get-my-payment and update your address. We encourage you NOT to put your banking information because this a relatively new system and susceptible to being hacked. Enter your bank information at your own risk.
I filed my last return with my ex-spouse who I have or can not have contact with. The direct deposit information was their account. What do I do?
First of all, I'm sorry you're going through this. Secondly, you'll need to contact your attorney in this case. Alternatively, you can get the stimulus check when you file your 2020 tax return next year.
Will I have to pay taxes on this stimulus check next year?
Now we're cooking! And the answer is no. The payment is not income and you will not owe taxes on your payment. It will not reduce your refund or increase the amount you may owe when you file your 2020 tax return next year.
I had my 2019 return prepared, but I haven't filed because I owe. Will they take that money from the stimulus check?
This one is a two-fer. First, you haven't officially filed your 2019 return so the IRS has no record of you other than your 2018 return (if you filed). Secondly, no. But you'll still need to pay your 2019 taxes - the good news is that you have until July 15th to do so.
I owe back taxes. Does that mean I won't get it or will they take the back taxes from this stimulus check?
Yes, you'll get the stimulus check and no, they will not take the back taxes out of this check. They will, however, reduce or deny your stimulus check if you have back-child support.
We appreciate your cooperation and patience. We will continue to monitor the situation closely and provide the latest updates and helpful resources at www.WaveFCU.org.
Thank you for being a valued member of Wave Federal Credit Union and please stay healthy and be safe.
President & CEO