If you’re one of the millions of Americans who received pandemic relief stimulus payments, or are waiting on payments that have not yet arrived, you may be concerned about your 2020 tax returns. Let us set your mind at ease: if your adjusted gross income (AGI) is less than $75,000 as an individual, or $150,000 as a couple filing jointly, you are likely qualified to receive stimulus payments. The second round of payments guarantees $600 per person, with an additional $600 per child under the age of 17 residing in the home.
You will not see additional taxes due on stimulus payments, so there is no need for you to set aside some portion of relief funds for tax season. In the unlikely event that you were overcompensated during the first or second round of stimulus checks, you will most probably not be required to pay the government back.
If you have not yet received your second, $600 payment, you may still receive it within the next week. If you are expecting a payment that does not arrive—whether for the first or second round of stimulus payments—I will request that your stimulus credit be delivered to you as a recovery rebate credit when I file your 2020 taxes.
There is one caveat: if you owe money on your taxes, this amount will be subtracted from the total stimulus rebate. If you owe $300, you’ll only be eligible to receive $300 as stimulus. The government still expects taxes to be paid in full this year.
If you are not required to file taxes due to your being disabled, retired, or a recipient of VA or SSI benefits, you are still eligible for your stimulus payment. The IRS has the necessary forms on file that will indicate your status and need.
When President Biden took office, he issued a $1.9 trillion relief plan that proposes an additional $1,400 for nearly all Americans. While that sounds promising to those who are still dealing with financial problems due to the coronavirus, this third round of payments may take months to start arriving in bank accounts or mailboxes.
Now more than ever, it’s vitally important that the tax returns you file show the IRS the complete scope of your finances. There were changes to the tax code in 2020, and our office is fully versed in each one. We are ready to help ensure that you receive every benefit to which you are entitled, including tax extenders and protective measures. As soon as you have your tax documentation, let’s get started!
Remember, we can make a request for any stimulus payments you are entitled to if you have not received them by tax time, and we’ll also take a close look at your tax returns to see if there is an error in play that’s contributing to the holdup.