CARES Act Economic Impact Payments
On March 30, 2020, the IRS announced that distribution of economic impact payments afforded under the Coronavirus Aid, Relief, and Economic Security Act (commonly known as CARES Act) will begin in the next 3 weeks and will be distributed automatically. However, inasmuch as the distribution of the payments is in part dependent on the individual’s 2018 and/or 2019 federal income tax filings, some taxpayers who typically do not file federal income returns will need to submit a simple tax return to receive the payment.
Eligible taxpayers who filed tax returns for either 2019 or 2018 will automatically receive an economic impact payment of up to $1,200 for individuals or $2,400 for married couples and up to $500 for each qualifying child.
- Individuals with adjusted gross income of no more than $75,000.
- Married couples filing joint returns with adjusted gross income of no more than $150,000
Reduced Payment (partial phase out)
- Taxpayers with income above those amounts, the payment amount is reduced by $5 for each $100 above the $75,000/$150,000 thresholds.
No Payment (full phase out)
- Single filers with income exceeding $99,000, and $198,000 for joint filers with no children are not eligible.
The economic impact payment will be deposited directly into the same bank account reflected on the last return filed. For cases where no direct deposit information is available, Treasury is developing a web-based portal for individuals to provide their banking information and receive a direct deposit.
IRS urges anyone with a tax filing obligation who has not yet filed a tax return for 2018 or 2019 to file as soon as they can to receive an economic impact payment.
Senior citizens, Social Security recipients, and railroad retirees who are not typically required to file a tax return will receive the $1,200 payment and do not need to take any action. Recipients will receive these payments as a direct deposit or by paper check, just as they would normally receive their benefits.
Economic impact payments will be available throughout the rest of 2020.