Stimulus Checks – FAQs and Helpful Links
By Chris Hostetler
The IRS is beginning to send out Economic Impact Payments, and there are many questions about these so-called “stimulus checks”. These payments were authorized by Congress a few weeks ago as a relief program for the millions of Americans whose financial situations have been negatively impacted by the coronavirus and social distancing measures.
While we hope to answer some of your questions below, the IRS provides the definitive information on these benefits at: https://www.irs.gov/coronavirus/economic-impact-payments
How much will I receive? If eligible, individual tax filers will receive up to $1,200, and joint married filers will receive up to $2,400.
Am I eligible? To determine if you are eligible, you can check here: https://www.irs.gov/coronavirus/economic-impact-payment-information-center. Note that income eligibility rules in particular will mean that many people receive a reduced payment or no payment at all.
Do I need to do anything? No, as long as you filed taxes in 2018 or 2019. If you were not required to file taxes in either year but receive Social Security or Railroad Retirement benefits, the IRS should still be able to find you and send your money.
If you filed taxes but did not provide direct deposit information, keep an eye on the IRS page for a tool that will allow you to provide this info.
In the unlikely event that you are eligible for the payment but neither pay taxes nor receive SS or Railroad benefits, you may file to receive this benefit here: https://www.irs.gov/coronavirus/non-filers-enter-payment-info-here
Is this taxable income? No. The Economic Impact Payment is treated as a tax credit, which means it is tax free.
When will I get it? The U.S. Treasury expect to send most payments within the next couple of weeks to those whose direct deposit information is on file (i.e. from your tax return). For all others, they anticipate beginning to send paper checks in May.
What do I do with the money? The short answer is that you can do whatever you want with the money. But remember the spirit of the program is to support Americans whose income has been negatively affected by the economic slowdown triggered by the coronavirus and social distancing measures. With that in mind, here are a few ideas:
Buy necessary supplies for staying at home (or working from home)
Supplement your cash reserve
Support a local charity
Patronize a local small business
Invest at currently low market prices
We know how difficult this time has been for so many people, but we hope you and your family are safe and healthy. Hilltop Wealth Advisors continues to be available to answer questions and review your financial plan. Please reach out if we can help with anything.
Disclaimers
Hilltop Wealth Advisors does not provide tax advice. The tax information contained herein is general and is not exhaustive by nature. Federal and state laws are complex and constantly changing. You should always consult your own legal or tax professional for information concerning your individual situation.
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The information contained herein is believed to be true as of the date of publication. It may be rendered out of date by subsequent legal or tax-rule changes, as well as variable economic and market conditions.