Under the recently passed CARES Act, the U.S. government is planning to send out Economic Impact Payments (EIP) to taxpayers meeting certain income requirements. Please note: the IRS is currently working on a website with a portal for individuals to provide their banking information to the IRS. It is not known yet when this portal will be released, but the IRS is advising taxpayers who plan to use it to keep checking irs.gov/coronavirus. There is no further information about payment dates or methods at this time.
If you are wondering how much you’ll receive and when you’ll receive any stimulus payment you are eligible for, check out the answers to these frequently asked questions:
Q: Are freelancers eligible to receive EIPs?
A: Yes. Freelancers are eligible to receive the EIPs being made to lower- and middle-income Americans depending on the eligibility requirements below.
Q: What is the maximum EIP I can receive?
A: The CARES Act makes available $1,200 for each adult (up to $2,400 for couples), as well as $500 for each child available to taxpayers who meet the stated income thresholds outlined below:
Q: What are the age and other requirements to be considered a qualifying child?
A: According to the IRS, a child who qualifies for the Child Tax Credit on a 2019 return is a qualifying child for an EIP. In other words, the child must:
Q: Do college-age dependents qualify for an EIP?
A: No, unfortunately, they do not. Dependents ages 17 to 24 years do not qualify for the child tax credit, so they will not qualify for the additional $500 payment, even if they were claimed on your return.
However, students ages 18 to 24 who were not a dependent on another return and had income but were not required to file should file their tax return as soon as possible to receive the economic impact payment.
Q. What if I don’t have any federal income tax obligations? Will I still receive a check?
A: Individuals with no federal tax liability will receive only $600. Nonresident aliens are not eligible for the rebate.
Q: What if I didn’t file my 2018 or 2019 tax returns?
A: Taxpayers who have not filed their taxes for those years will not receive a check unless they didn’t file due to only having social security income (forms SSA-1099 or RRB-1099). The Treasury department will use 2019 social security filings to determine the size of your stimulus pay out.
Q: What if I am not typically required to file a tax return—will I still receive a payment?
A: Yes. The IRS will use the information on the Form SSA-1099 or Form RRB-1099 to generate Economic Impact Payments to recipients of benefits reflected in the Form SSA-1099 or Form RRB-1099 who are not required to file a tax return and did not file a return for 2018 or 2019. This includes senior citizens, social security recipients and railroad retirees who are not otherwise required to file a tax return. If you are in this group, check IRS.gov/coronavirus for updates.
Q: Do I need to file or apply to receive a stimulus check?
A: Most taxpayers do not need to take any action to receive their stimulus check. The IRS will calculate and automatically send the payment to those eligible.
Q: How will the IRS know where to send my payment?
A: If you have already filed your 2019 tax return, the IRS will use the direct deposit information you provided to transfer the money to you. If you haven’t filed yet, they will use the 2018 information instead.
Q: What if the IRS does not have my direct deposit information. What can I do?
A: The Department of Treasury is working on a website with a portal for individuals to provide their banking information to the IRS. It is not known yet when this portal will be released, but the IRS is advising taxpayers who plan to use it to keep checking irs.gov/coronavirus .
Q: I need to file a tax return. How long are the economic impact payments available?
A: Economic impact payments will be available throughout the rest of 2020. Filing your return now will help to expedite any payment you are eligible for.
The details of the Economic Impact Payments and other government aid during the coronavirus pandemic is changing daily. You can get the most current information on economic impact payments, unemployment benefits and tax relief related to COVID-19 from the IRS. They will post all key information on irs.gov/coronavirus as soon as it becomes available.
Jonathan Medows is a certified public accountant licensed in New York, New Jersey, Maryland, and Pennsylvania. He is also a recognized expert in taxation for freelancers and the self-employed—often tapped for his expert knowledge and perspective on self-employment taxation by national and regional publications such as The New York Post, BusinessWeek, Forbes taxation blog, WebCPA, CPA Practice Advisor, and others. You can read some of Jonathan’s press coverage here.
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