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The President just signed into law the new CARES act which is a $2 trillion stimulus package meant to rejuvenate the struggling US economy and to provide much-needed resources to certain industries, including the travel and healthcare industry.
As a part of this package, individuals will be entitled to receive checks from the government. Below is everything you need to know about these checks, including how to expedite receiving your funds.
Only people who are under the income requirements will receive a check. These income requirements are based on your adjusted gross income. You can find your adjusted gross income on Line 8b of the 2019 1040 form.
Here are the amounts you will get based on your adjusted gross income:
- If you are an individual and make $75,000 or less in one year, you will be entitled to $1,200.
- If you are filing as a couple, and make $150,000 or less in a year you will be entitled to $2,400.
- Taxpayers filing as head of household get full payment if they earned $112,500 or less
For every dependent that you have 16 years or younger, you can also receive an additional $500 (I’m not sure if there’s a limit on those). Note that you can’t get a payment if someone claims you as a dependent.
If you make more than the allocated amounts, you will receive a prorated amount up to a certain cap. For example, your payout amount over $75,000 in income would be reduced by $5 for every additional $100 of adjusted gross income. There’s a calculator here.
There is an income cap of $99,000 for individuals and $198,000 for married couples with no children. A family with two children won’t be eligible if their income is over $218,000.
What year your income is determined
Your income will be based on your most recent filing year with the IRS.
So if you filed taxes for 2019 already, that will determine your eligibility. But if you have not filed your taxes for 2019 then your income will be based on what you received in 2018. Remember that the tax filing and payment deadline has been pushed out 90 days.
An important thing to note is that you must file your taxes in order to be eligible.
How long will it take to get the check
Treasurer secretary stated that you should receive your payment within a 2 to 3 weeks. But keep in mind that the IRS took three months to distribute checks in 2009 in the Great Recession and many people have called into question if the IRS will be able to send these out that efficiently.
To expedite receiving your check, be sure that you have signed up for direct deposit from the IRS. This is usually selected on your tax form when you choose how you would like to receive your refund .
If you want to receive your check at a new address that is not the same address you filed with, you will need to submit a change of address form. It can take 4 to 6 weeks to process a change of address form, so you want to fill this out and submit it as soon as possible.
There is an IRS website dedicated to the stimulus checks but it currently does not display anything helpful. It might be updated soon with details on how to sign up for direct deposit in case you have not done that.
A couple of more points:
- People receiving Social Security and disability payments each month will be eligible.
- Citizens living abroad can receive payments.
- If you are subject to garnished wages, the bill will suspend those attempts so your check will be safe. However, if you are behind on child support you may not be able to receive the check.
- You will not have to pay income tax on your stimulus check.
- You will only be issued one check although some in Congress have mentioned sending out additional checks.
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Daniel Gillaspia is the Founder of UponArriving.com and creator of the credit card app, WalletFlo. He is a former attorney turned full-time credit card rewards/travel expert and has earned and redeemed millions of miles to travel the globe. Since 2014, his content has been featured in major publications such as National Geographic, Smithsonian Magazine, Forbes, CNBC, US News, and Business Insider. Find his full bio here.