Economic Impact Payments: Coming Soon to Your Bank Account
Coronavirus stimulus payments, provided for in the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act signed into law late-March, started arriving in bank accounts this Wednesday, April 15. According to the US Treasury, “a large majority of eligible Americans” will receive the payments by next Friday, April 24.
The first payments are going to those who already filed their 2018 or 2019 returns and authorized the IRS to make a direct deposit of any refunds due. And within that group, the IRS is starting with the lowest incomes. Social Security recipients will also automatically receive their payments, even if they haven’t filed a return.
Where’s My Payment?
There are millions of people who don’t fall into the categories above. If you haven’t been required to file a return in the past two years, or haven’t authorized direct deposit of a 2018 or 2019 tax refund, you can update bank information using the IRS Get My Payment web portal.
The Get My Payment portal can also be used to check on payment status. You’ll need to enter your Social Security number, date of birth and mailing address. If your payment status is not available, wait 24 hours and check again; the IRS is updating their data daily, not in real-time.
Am I Eligible?
Eligibility for stimulus payments is based on income. Excluded are individuals earning more than $99,000, head of household filers with one child who earn above $146,500 and married couples with children earning more than $198,000. Families earning a little more may still be eligible if they have children. A typical family of four is phased out if incomes exceed $218,000. Those who can be claimed as dependents are also excluded.
Are There Tax Consequences?
The stimulus payments will not be taxed as income and won’t offset any back-taxes owed. The payments also won’t affect refund payments for 2019.
How Much Will I Get?
Individuals and heads of households are due up to $1,200; married couples will receive up to $2,400, plus $500 per qualifying child. Payments start phasing out for individuals with adjusted gross incomes of more than $75,000, heads of households earning more than $112,500, and married couples who earn more than $150,000. Above the phase-out levels, amounts are reduced by $5 for every additional $100 of adjusted gross income.
How Can I Get My Payment Faster?
If your bank account information is not on file, use the Get My Payment tool to input your bank information to receive the money electronically, as it could take weeks or months to receive a check by mail. You will need to submit your adjusted gross income from your most recent tax return, the refund (or amount owed) that year and the account and routing numbers for your bank account.
Note that bank information cannot be updated once the payment is scheduled for delivery and bank information cannot be updated if it is already on file.
What if I Haven’t Filed a Tax Return?
People whose income did not exceed $12,200 ($24,400 for married couples) and were not otherwise required to file a tax return, do not need to file a tax return to receive their impact payment. The IRS created this tool for those “non-filers” to input basic information including name, date of birth, Social Security number and number of dependents in order to receive their payment.
Beware of Scammers
Beware of scam artists trying to use the economic impact payments as cover for schemes to steal personal information and money. The IRS will not call, text you, email you or contact you on social media asking for personal or bank account information – even related to the economic impact payments. Finally, watch out for emails with attachments or links claiming to have special information about economic impact payments or refunds.
For more detailed information, check out the IRS Economic Impact Payment Information Center.
As always, Charter Oak appreciates the opportunity to guide you and your families through your financial lives, helping you plan, invest, and make smart financial decisions.