Stimulus Payments - Economic Impact Payment (EIP)
Under the CARES Act that was signed into law on Mary 27th, 2020, Congress authorized the IRS to issue stimulus payments to US taxpayers in response to the Corona virus pandemic. These stimulus payments were named Economic Impact Payments (EIP) but are generally referred to as Stimulus payments.
The payments are structured to be $1,200 to single taxpayers with adjusted gross income up to $75,000, $2,400 to married taxpayers with adjusted gross income up to $150,000. The EIP begins to phase out 5% of the amount over the $75,000/$150,000, which means that a single taxpayer with income of $99,000 and above will not receive an EIP, married couples over $198,000.
There is an additional EIP amount for taxpayers that have children under 17 claimed as dependents. That amount is $500 and would increase the phase out amount to account for that as well.
The EIP payments being sent out during this time are based on filed tax returns for 2018 or 2019. The EIP is an advance payment of an increased refundable rebate that will be reconciled on the 2020 tax return.
This program has not been without challenges, as the IRS began sending out payments in about 2 weeks after passage of the law to taxpayers that had direct deposit information from 2018 or 2019 filed tax returns but there were issues with providing bank info if the tax return had a balance due, if the taxpayer moved or if the taxpayer passed away in 2018, 2019 or 2020. The IRS is making adjustments and updates to the system to provide payments to the public.
The IRS has put together a website to answer questions, provide payment status, provide banking information if not reported on the tax return. The website is here: IRS Get My Payment.
If you have not filed a 2018 or 2019 return and are required to file a return, prepare the 2019 tax return and submit that to the IRS as soon as possible. Once you have filed the 2019 tax return, the IRS can use that information to determine eligibility for the EIP.
If do not have a tax filing requirement, the IRS has provided a non filer option here. This files a tax return with the IRS, so ONLY use this option if you don't need to file a tax return, if you do need to file a tax return after using this system, it will require an amended tax return to be filed and will cause delays and confusion with the IRS.
The IRS is updating the Get My Payment website FAQs (Frequently Asked Questions) and payment status on a daily basis, so check back there regularly.
If you have problems accessing the system and are a client of Gaylor Tax, we may be able to help but since the IRS is mostly closed currently, our office will only have access to the same information that you do.
Stay healthy and safe.
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