In in the summer of 2020, US citizens are edging ever closer to their second major stimulus check in less than a year. This payment was otherwise titled an “Economic Impact Payment” (EIP) by the IRS, and will be sent automatically to most US taxpayers. IF you filed a tax return in 2018, 2019, or are a senior or retiree, the IRS suggested that “no further action is needed” in order for you to get a Economic Impact Payment.
This stimulus check was meant to assist citizens in remaining at home, quarantined, instead of heading back to work before COVID-19 is fully contained. That bit is… still a long way coming, but the IRS-sent stimulus check is currently in the works as this article is set to publish.*
*To be extra clear, here, negotiations are not complete as of publish time for this article. Negotiations could be complete by the time you read this article, depending on when you read this article. But they final deal had not been reached at the moment at which this article was set to publish. As such, some details included below could change before the newest Economic Impact Payment deal is reached in DC.
When will I get my money?
Below in a video posted on August 2, 2020, by Bloomberg. This video shows US Secretary of the Treasury Steven Mnuchin speaking about COVID-19 aid negotiations and the speed at which payments will be able to be sent when negotiations are complete.
It was suggested there that payments will come faster than they did with the first wave earlier in 2020. The CARES Act, passed by the Senate on March 25, 2020, then the House on March 26, signed on March 27, saw “first checks” sent on April 15, 2020. It’s been suggested by Mnuchin that when the new agreement is reached, the IRS could “start printing [stimulus checks] the following week.”
Users can check the status of their Economic Impact Payment with the IRS’ official Gey My Payment tool. The very earliest we could see checks sent is the week of August 17th, and that’s IF the Senate passes a bill on August 10, 2020, and all goes perfectly well with the House, passing on August 11, and the signing on August 13.
It’s also possible that we’ll be waiting for the Senate to start a new session on September 8, which could push the first checks back to later in September, too.
How much money will I get?
As of August 3, 2020, the official IRS listing for “Calculating My Economic Impact Payment” included a section called “How do I determine the amount of my Economic Impact Payment?” This section was updated on August 3, 2020.
If you are an eligible individual, filing as an individual, you’ll receive up to $1,200 USD. Eligible individuals who file a joint tax return “will receive up to $2,400”.
Qualifying children will receive up to an additional $500 “per qualifying child”. All of the qualifications for a child as noted can be found on the IRS’s EIP Qualifying Child Requirements page.
Income max before reductions
There is no minimum income necessary for an individual to be eligible for an Economic Impact Payment. There is a maximum amount of adjusted gross income you can have before your EIP is reduced. This is because the stimulus is meant to be a cash injection for those families and individuals most in need of money to stay afloat.
Your max adjusted gross income before EIP reductions:
• $150,000 for taxpayers filing a joint return
• $112,500 for taxpayers filing as head of household
• $75,000 for all others
If you exceed the amount listed above, your EIP starts to go down. The payment is reduced by 5% of the amount that a taxpayer’s adjusted gross income exceeds the amount listed above (according to their filing status).
After the amounts listed above, you get a lower EIP the more money you’ve made (adjusted gross income). If your adjusted gross income is at or above the following amounts, your EIP will end up being zero.
Your EIP will reach $0 if your adjusted gross income is:
• $198,000+ for taxpayers filing a joint return
• $136,500+ for taxpayers filing as head of household
• $99,000+ for all others
Five percent of your income above $150k taken away from $2400 reaches zero once your income reaches $198,000.
190,000 – 150,000 = 48,000
48,000 x 5% = 2400
The IRS documentation on this bit of calculation suggests that “adjusted gross income threshold amounts increases by $10,000 for each additional qualifying child.” This does not mean that the “5% of adjusted gross income” reduction begins any higher than $150,000. It just means that, if you have more kids, you’ll have to be making a substantial amount more income before your entire EIP is reduced to zero.
No matter what, the reductions start at $150k for join returns, $112,500 for head of household, and $75k for all others.
At this moment, it would appear that this will hold true for the Economic Impact Payment that’ll be made to US taxpayers in the near future, here in the summer of 2020. Make sure you check with the IRS on this subject before you make any major decisions about your economic future. The most updated information on this payment can be found at the IRS Economic Impact Payment Information Center official page through the future.