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One of the cornerstones of the Senate coronavirus The stimulus package is the direct payment of money from the federal government to American individuals and families.
In the middle of bill’s hundreds of pages are details of exactly who can expect and how much they can expect. Here is a breakdown.
Who is eligible?
The bill specifies that everyone is eligible, except non-resident foreigners and those who can be used as a basis of deduction for another person.
“Seniors, veterans, the unemployed and low-income Americans would also be eligible,” said Senate Finance Committee chairman Chuck Grassley said on Wednesday.
The text of the bill indicates that those who receive social security can collect checks: for those who are not required to file 2018 or 2019 tax returns due to social security benefits, tax returns are not required to claim money – the government can use information from a Form SSA-1099, Statement of Social Security Benefits, or Form RRB-1099, Statement of Equivalent Social Security Benefits.
With that in mind, here is what people can hope to get.
People who report their taxes as individuals are eligible for payments of up to $ 1,200, but this decreases for people who earn more than $ 75,000 a year. The bill says that the payment is reduced by five percent of each dollar above this mark, or $ 50 for every $ 1,000 above $ 75,000.
Ultimately, this means that for people who earn more than $ 75,000, the lower the payment, the higher their income, the amount being reduced to zero for those who earn $ 99,000 or more.
Persons filing jointly
Couples who file a joint tax return are eligible for a payment of up to $ 2,400, plus an additional $ 500 per child. However, this amount decreases for couples who earn more than $ 150,000 a year at the same rate of 5% of every dollar above this mark.
This translates into less money the more people earn, which is reduced to zero for childless spouse tax filers who earn $ 198,000 or more.
Persons testifying as heads of household
Those posing as heads of household are entitled to payments of up to $ 1,200, but this amount is increased by $ 500 per child. This amount is reduced for people who earn more than $ 112,000 a year. The extent to which it decreases, of course, depends on the number of children they have, as shown in the table above.
The following table, courtesy of the Tax Foundation, illustrates how it all works.
Income is based on people’s income tax returns for 2019, but they have not filed for that year, so their return for 2018 applies.
“[I]If the individual has not filed an income tax return for the first taxation year of that individual as of 2018, “says the bill, the information should be used for 2019 in their SSA social security benefit statements -1099 or RRB-1099.
When and how are payments made?
According to the invoice, payments will be made “as soon as possible” and no later than December 31, 2020. They will be made by direct deposit into an account that the person has authorized for tax refunds or federal payments starting at or after. January 1, 2018.
A notice will be sent to the person’s last known address within 15 days of payment to inform them of the method and amount of the payment. A phone number will also be provided so people can call the IRS in case they don’t receive it.