The first batch of around 5 million paper cheques should have arrived today in the mail for many Americans, while the distribution of paper cheques will continue until mid-September. Social Security recipients who don’t file taxes are expected to receive their stimulus payments by the end of April.
Single adults with income up to $75,000 will get a $1,200 payment. Married couples with income up to $150,000 will get $2,400. Single parents who file as head of household with income up to $112,500 will get the full $1,200 check.
And, Americans who qualify for the stimulus payment and have children will get an additional $500 per child under 17.
Reduced cheques will be available for single adults who earn between $75,001 and $99,000 and married couples who earn between $150,001 and $198,000.
The cheque will be reduced by $5 for every $100 over $75,000 for single adults and $150,000 for married couples. The reduction will apply to the entire amount of the payment including the additional $500 per qualifying child.
Who doesn’t get a cheque?
Single adults who make more than $99,000 and married couples who earn more than $198,000 won’t receive stimulus cheques.
Those without a Social Security number and nonresident aliens — those who aren’t a U.S. citizen or U.S. national and don’t have a green card or have not passed the substantial presence test — aren’t eligible.
You’re also ineligible if your parents claim you as a dependent on their taxes.
How will the government send you the stimulus check?
The IRS will use the direct deposit information you provided from the taxes you’ve filed either for 2019 or for 2018.
The payments will be deposited directly into your bank account if you received your last tax refund or expect to receive this year’s refund that way.
Otherwise, cheques will be mailed, which could take longer to get to Americans. Adding to the complications, about 6% of U.S. adults — or about 12 million Americans — do not have a checking, savings, or other bank account, according to a 2018 Federal Reserve report.
Social Security and Veteran Affairs recipients will get their payments deposited automatically but benefit recipients with qualifying dependents and they haven’t filed taxes for 2018 or 2019 will have to use the ‘Non-Filers’ tool to file a simplified return to get the additional $500 per child.
How can those who don’t file taxes get a payment?
Americans who don’t usually file taxes can register to get their stimulus aid checks on IRS website or use Turbotax’s free tool to file a minimum tax return.
The IRS tool is for eligible U.S. citizens or permanent residents who had gross income below $12,200 ($24,400 for married couples) for 2019 and weren’t required to file a 2019 federal tax return.
“There are as many as 10 million Americans who are not required to file a tax return,” TurboTax said in a statement. “Because the IRS will use the federal tax return to determine and send individual stimulus payments, these individuals are at risk of not receiving their stimulus payment.”
The tools will use the information to file and automatically complete a Form 1040 and send it to the IRS.
They’ll also help determine if you’re eligible for the stimulus payment. If eligible, you need to answer a few questions, provide the required information, and choose whether to get the payment through direct deposit or cheque. If you don’t provide direct deposit information, the check will be mailed to you.
Social Security recipients and those required to file tax returns don’t need to provide additional information, but still must meet the eligibility criteria to get a payment.
When are you getting the payment?
This week, the IRS starts sending paper checks on a weekly basis to individuals whose direct deposit information isn’t on file.
Paper cheques will be issued at a rate of about 5 million per week, meaning it could take up to 20 weeks to issue all the checks expected to be mailed.
The cheques will be issued in reverse “adjusted gross income” order — starting with people with the lowest incomes first. Taxpayers with income up to $10,000 will be the first to get their checks, which are expected to arrive by April 24.
Americans with income up to $20,000 are expected to get their checks by May 1, while those with income up to $40,000 by May 15. The rest of the cheques will be issued by gradually increasing income increments each week. Households earning $198,000 who file jointly will get their reduced checks on Sept. 4. The last group of cheques will be sent on Sept. 11 to those who didn’t have tax information on file and had to apply for checks.
Social Security and other benefits recipients who haven’t filed taxes in the last two years will receive their automatic payment at the end of April.
Can you track the payment?
Yes. Those who are still waiting can track it online. Americans are also able to provide the Internal Revenue Service with their direct deposit information if it’s not on file with the agency.
“If you do not receive them by Wednesday, you’ll be able to put in your direct deposit information, and within several days, we will automatically deposit the money into your account,” Treasury Secretary Steven Mnuchin said on Monday. “We want to do as much of this electronically as we can.”
The new tool allows Americans to follow the scheduled payment date for either a direct deposit or mailed cheque. It’s an online app that works on desktops, phones, or tablets and doesn’t need to be downloaded from an app store, The Treasury said.
To track your payment, you must provide basic information including:
- Social Security number
- Date of birth
- Mailing address
The tool also lets people provide their bank account details to get their payment by direct deposit instead of waiting for a mailed check, which go out April 24.
If you filed a tax return in 2018 or 2019 but didn’t provide direct deposit information, you’ll be able to identify yourself, input that banking information, and receive the payment in several days in your account, according to Mnuchin.
To add direct deposit information, you will need to provide:
- Adjusted gross income from your most recent tax return submitted, either 2019 or 2018
- The refund or amount owed from your latest filed tax return
- Bank account type, account, and routing numbers
Do you have to pay tax on it?
No. The stimulus payments are federal income tax refunds and aren’t subject to federal income tax.
Do you have to pay back the stimulus cheque?
No. The stimulus payment is actually a refundable credit against your 2020 tax liability, according to Kyle Pomerleau of the American Enterprise, and is paid out as an advanced refund. That means you don’t have to wait to file your 2020 taxes to get the money.
It also doesn’t reduce any refund you would otherwise receive, Watson said.
In fact, if you don’t qualify for the stimulus cheque now based on your 2018 or 2019 tax returns, you may be able to qualify to take the tax credit next year when you file your 2020 taxes if your income meets the thresholds.
By Tsekova, Reporter, Yahoo MoneyApril 24, 2020
Denitsa is a writer for Yahoo Finance and Cashay, a new personal finance website. Follow her on Twitter @denitsa_tsekova.
