The severe economic effects of the COVID-19 epidemic, as well as the broad shutdowns required to manage it, are beginning to emerge.
More than 30 million People in the U.S. have applied for unemployment benefits, and more will do so. Congress has reacted with a $2 trillion stimulus program called as the Coronavirus Aid, Relief, and Economic Security (CARES) Act in an effort to keep financially stricken Americans solvent.
While most people will receive a CARES Act stimulus payment (those $1,200 max checks you’ve been hearing about), you might be shocked if you don’t. Here are three possible reasons why you might not receive a stimulus payment:
1. Your Yearly Gross Income Is Too High
In terms of stimulus payments, there are three-dollar values to be aware of: Individual taxpayers will receive $1,200, married couples filing jointly will receive $2,400, and families will earn an extra $500 each qualified kid under the age of 17. Those figures, however, only apply to particular income levels. Individuals with an AGI of up to $75,000, married couples filing jointly with an AGI of up to $150,000, and heads of households with an AGI of up to $112,500 will get the full amount of stimulus payments. Remember that AGI will be calculated using your 2019 tax return, or 2018 if you haven’t filed yet.
Groups that earn more than those AGI numbers, on the other hand, begin to fall into the “phase out” category, which indicates that the stimulus amount supplied decreases as AGI increases. Individuals and families will be paid $5 less for every $100 in earnings that exceed the limitations. The overall phase out values, which indicate that the AGI is too high to qualify for a stimulus payment, are $99,000 for single taxpayers, $198,000 for married couples filing jointly, and $136,500 for heads of households.
Here are estimations of stimulus amounts for various filing statuses and income levels to give you a sense of how the phase off works. Remember that each qualified kid under the age of 17 will add $500 to these stimulus amounts. After the payment to adults has been entirely phased out, the payment to children begins to phase off (at the same $5 per $100 of income).
- AGI of $80,000: $950 stimulus
- AGI of $85,000: $700 stimulus
- AGI of $90,000: $450 stimulus
Married couples filing jointly
- $1,900 stimulus for $160,000 AGI
- $1,400 stimulus for $170,000 AGI
- AGI: $400 for $190,000
Head of the Family
- $1,075 stimulus for $115,000 AGI
- AGI of $120,000: $825 stimulus
- AGI of $130,000: $325 stimulus
If you does not want to do the figuring out just how much your stimulus check will indeed be, Forbes’ Stimulus Check Calculator will do it for you. The only information you’ll be required to supply is your filing status, income, and the number of child dependent you claimed.
2. If You’re Unemployed, but Your Previous Tax Returns Make You Ineligible
If you’ve already submitted your 2019 taxes and are disqualified because you earned too much on them, but you’re now unemployed, you’re undoubtedly terrified of not receiving assistance in your time of need. It’s inconvenient, but there is a clause in the stimulus plan that guarantees you will receive a stimulus check—it just won’t be instant.
If your income reduces unexpectedly this year owing to unemployment or working fewer hours or gigs than the previous year, you’ll be eligible to claim the stimulus on your 2020 tax return. That implies you’ll have to wait till next year to get your hands on it.
That isn’t always useful for people who need money right now. If you require urgent economic help, several banks that offer payment arrangement programs, mortgage relief, and other services to clients who are facing financial difficulty as a result of COVID-19. In addition, until the end of September, the Department of Education will suspend federal student loan payments without interest.
These alleviation techniques will not put money in your pocket right now. However, because most of the country is now required to shelter in place or successfully file for unemployment, they may be able to keep you afloat in the meanwhile while you look for a work from home job or gig.
Another point to bear in mind is that, while the stimulus payments are technically a tax credit, they are being paid in 2020. If you happen to make more money this year and wind up in the phase-out group, it appears you will not be required to repay the money to the government.
3. If You Delayed to Update Your Bank Account Information Before Deadline
This does not imply you will never receive a payout if you meet all of the other requirements. However, it may explain why it is taking so long to collect the stimulus funds to which you are entitled.
Stimulus funds will be sent directly into the bank account mentioned on 2019 tax returns (or 2018, if you have yet to file for last year). If no bank account is included on either return, the IRS will send a physical check to your most current address on file, which may take months, according to some experts.
The IRS developed the “Get My Payment” application, which allows consumers to change their banking account information online.
Consumers must submit their bank account details by Wednesday, May 13 at 12 p.m. ET. If you do not update or add your bank details, your check will be delivered to the IRS’s default address.
The Treasury is required by law to mail a notification of payment to the last known address. If you did not receive the payment, the letter will contain a phone number to call at the IRS. This might be useful for those who live at the same location as on their last tax return but have changed their banking information and haven’t updated it in the IRS site. However, if your payment goes missing—that is, you no longer have access to whatever address you have had on file with the IRS.