By Thomas Neal Tillery
Under the CARES Act, individuals with adjusted gross income up to $150,000 for married taxpayers filing jointly, $112,500 for taxpayers who file as head of household, and $75,000 for other individuals will receive the full payment. For taxpayers with income above those amounts, the payment amount is reduced by $5 for each $100 above the applicable thresholds. Thus, the payment phases out for single filers with income exceeding $99,000 and for joint filers with income exceeding $198,000 (with no children).
For individuals with incomes above these amounts, the economic impact payment amount is reduced by $5 for each $100 above the $75,000/$112,500/$150,000 thresholds. Single taxpayers with income exceeding $99,000 and $198,000 for married joint filers with no children are not eligible for 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. Parents also receive $500 for each qualifying child.
Transmission of the payment
The IRS will calculate, and automatically send, the economic impact payment to eligible recipients. For those who have already filed their 2019 income tax returns, the IRS will use this information from that return to calculate the payment amount. For those who have not yet filed their 2019 income tax return, the IRS will use information from their 2018 income tax return to calculate the payment. Additionally, the economic impact payment will be deposited directly into the same bank account reflected on the tax return filed.
The IRS does not have my direct deposit information. What can I do?
In the coming weeks, Treasury plans to develop a web-based portal for individuals to provide their banking information to the IRS online, so that individuals can receive payments immediately as opposed to checks in the mail.
Some taxpayers may not typically file an income tax return, such as seniors or individuals of limited means. These individuals will need to file a simple tax return to receive the economic impact payment. As of this posting the portal for this simple tax return has not yet been created.
For more information go to: https://home.treasury.gov/coronavirus