Federal Economic Stimulus or Economic Impact Payment FAQs

 

 

Economic Impact Payment – Information about the Economic Impact Payment Program has been changing frequently. Please refer to this page of the IRS website for the most current information.  

Watch our webinar about how pandemic payments may impact your 2020 taxes:

 

 

The recently enacted Consolidated Appropriations Act, 2021 includes COVID-19 tax relief legislation.  The legislation is intended to provide further economic relief to address the impact of the ongoing COVID-19 pandemic.  COVID-related tax relief to individuals would come in the form of a third round of Recovery Rebate Credits (an Economic Impact Payment).

  • Who is eligible for the Economic Impact Payment? U.S. citizens or resident aliens who:
    • Have a valid Social Security number
    • Cannot be claimed as a dependent of another taxpayer, and 
    • Had adjusted gross income under certain limits.
  • Who will receive the Economic Impact Payment automatically without taking additional steps?
    • Individuals who received a “first round” Economic Impact Payment
    • Individuals who filed a federal income tax for 2018 or 2019
    • Individuals who receive Social Security retirement, disability (SSDI), or survivor benefits
    • Individuals who receive Railroad Retirement benefits
    • Individuals who receive Supplemental Security Income (SSI)
    • Veterans Affairs recipients
  • What if none of the above apply to me?

You would claim the Recovery Rebate Credit (if eligible) on your 2020 income tax return and receive a payment for the full amount of the first and second round of Economic Impact Payments in the form of an income tax refund

  • How much is the Economic Impact Payment?

The first round of the Economic Impact Payment was $1,200 ($2,400 for married taxpayers). Parents also receive $500 for each qualifying child.  In general, a child who lives in the U.S., is under 17 years of age, and has a social security number is a qualifying child.                       

The second round of the Economic Impact Payment is $600 ($1,200 for married taxpayers). Parents also receive $600 for each qualifying child.

    The third round of the Economic Impact Payment is $1,400 for individuals or $2,800 for married couples, plus $1,400 for each dependent. 

    • I receive Social Security Disability (SSDI) and it says that my Economic Impact Payment Income will be sent to me automatically but, will I receive an additional $500 for each of my dependents as well?

    Clients who don’t have a filing requirement and haven’t filed a return recently but who receive federal benefits like Social Security retirement, SSI, SSDI, Railroad Retirement Benefits, or Veteran’s benefits also don’t need to do anything. Their Economic Impact Payment will be automatically paid using the method they usually receive their benefits.

    If you have dependents under 17, and want to receive the additional $500 per child. You must use the nonfiler tool to provide information on the dependent: https://www.irs.gov/coronavirus/non-filers-enter-payment-info-here

    • Do I qualify for the Economic Impact Payment if  I have an Individual Taxpayer Identification Number (ITIN)?

    No,  you must have a Social Security number to receive the payment. However, the State of California will provide the Golden State Stimulus payments to families and individuals who have an ITIN and otherwise qualify.  Follow this link for more information and to determine the amount of your payment.  Golden State Stimulus  FT

    • I filed a joint return with my spouse.  Will we receive the Economic Impact Payment if I have a valid SSN and my spouse has an IRS Individual Taxpayer Identification Number (ITIN)?

    Yes, married taxpayers filing joint returns where one spouse has a Social Security Number and one spouse does not are eligible for a payment of $600 in addition to $600 per child with a Social Security Number.

      • My children have Social Security numbers but I have an ITIN, do I qualify for Economic Impact Payment?

      Yes, qualifying children with social security numbers would be eligible to receive the stimulus under the Third round Economic Impact Payment even if their parent(s) have an ITIN.

      • What if I do not usually file a return? How will I get my Economic Impact Payment?

      If you receive veteran’s disability compensation, a pension, or survivor benefits from the Department of Veterans Affairs, or your income level does not require you to file a tax return, then you need to submit information to the IRS to receive an Economic Impact Payment. Click on this link to update your information with the IRS: https://www.freefilefillableforms.com/#/fd/EconomicImpactPayment

      • Is the Economic Impact Payment taxable?

      No.  It is not taxable. People who receive an Economic Impact Payment this year should keep Notice 1444, Your Economic Impact Payment, with their tax records. This notice provides information about the amount of their payment, how the payment was made, and how to report any payment that wasn’t received.

      For security reasons, the IRS mails this notice to each recipient’s last known address within 15 days after the payment goes out. It’s especially important for people to keep this notice if they think their payment amount is wrong. When they file their 2020 tax return, they can refer to Notice 1444 and claim additional credits, if they are eligible for them.

      Taxpayers should keep this notice filed with all their other important tax records. These include W-2s from employers,1099s from banks and other payers, other income documents, and virtual currency transaction records.

      • What do I need to do to receive the payment?

      No action is required if you have filed a 2018 or 2019 tax return or if you currently receive social security benefits.  The federal government will use this information to identify eligible individuals who should receive an Economic Impact Payment. Click here to check your payment status.

      • What if I only receive Social Security retirement income?

      If you receive Social Security retirement, disability (SSDI), survivor benefits, Supplemental Security Income (SSI), or Veterans Affairs benefits, the IRS will automatically send you an Economic Impact Payment. You do not need to fill out any forms.

      • How will I receive the Economic Impact Payment?

      The majority of payments will be delivered through direct deposit, check, or through a pre-paid MetaBank debit card issued by the Department of Treasury. If you’re a recipient of certain federal benefits, you’ll receive the latest EIP in the same way you receive your benefit payments.  If you would like to have the Economic Impact Payment directly deposited into your account, use the ‘Get my payment’ portal. This tool will show if a payment has been issued and whether the payment was direct deposited or sent by mail.

        • I am in college. Can I receive an Economic Impact Payment?

        Yes.  So long you file a 2018 or 2019 tax return and are not claimed as a dependent on another person’s tax return.