More Ways to Qualify for the $1,200/$2,400 Economic Stimulus Checks
More Ways to Qualify for the $1,200/$2,400 Economic Stimulus Checks
The IRS has recently updated its website to answer a few questions on how to qualify for the CARES Act tax credits via economic impact payments. In general, you are eligible for these payments if you filed tax returns for either 2019 or 2018. The maximum payments are $1,200 for individuals or $2,400 for married couples. Parents also receive $500 for each qualifying child under the age of 17 as of the end of 2020.
Like every other tax law, there are exceptions. You will not receive any payments once your adjusted gross income exceeds $75,000 (for single) or $150,000 for married couples filing jointly.
What happens if your income qualifies in one year but not the other? Here is what the IRS says:
Question: If the IRS used a taxpayer's 2018 tax return to determine the individual is not eligible for a payment, and the taxpayer later files a 2019 tax return that changes his or her eligibility, will the IRS issue a payment in 2020 based on the 2019 tax return?
Answer: No. If the IRS has determined that a taxpayer was not eligible for a payment based on the taxpayer's 2018 tax return, and then the taxpayer files a 2019 tax return that shows eligibility, the IRS will not issue a payment in 2020 based on the 2019 tax return. These taxpayers can claim amounts based on their 2020 tax returns in 2021 if they remain eligible for 2020.
Question: If the IRS used an individual's 2018 tax return to determine the amount of the individual's payment, and the individual later files a 2019 tax return that indicates the individual is eligible for a higher amount, will the IRS issue an additional payment for the difference?
Answer: No. If an individual hadn't filed a 2019 tax return or the return had not been processed at the time of the IRS determination, the IRS used the information from the individual's 2018 tax return to issue the payment.
If an individual received a payment that is less than the full amount to which the individual is entitled, the individual will be able to claim an additional amount based on his or her 2020 tax return when the individual files it in 2021.
Wrap Up: What this means is that if you did not qualify for one year but do for the other, any payment that you did not receive can be claimed as a tax credit on your 2020 tax return. This tax credit is refundable.