One aspect of the most recent COVID-19 relief law, the Coronavirus Aid, Relief, and Economic Security Act (or CARES Act), is an Economic Impact Payment (EIP) for most Americans. This is often referred to by the media or various politicians, including President Trump, as a "check in the mail." The vast majority of Americans will not need to take any extra steps to receive this emergency aid, and according to Treasury Department officials, can expect to have the extra money deposited into their bank account or receive a check in their mailbox before the end of April. Below is a quick guide that will provide some general information about who is eligible to receive Economic Impact Payments and how much you can expect to receive.
To receive an Economic Impact Payment, you must meet two criteria:
- You must have filed a tax return for years 2018 or 2019
- Your Adjusted Gross Income (AGI) must be below a specific threshold (detailed below)
There are a few exceptions to the first criterion. If you receive Social Security benefits or SSDI and are not required to file a tax return, you will still receive an Economic Impact Payment. Instead of using a tax return to determine where to send the payment, the IRS will use Form SSA-1099. Based on guidance released April 15, 2020, Supplemental Security Income (SSI) recipients will also receive their Economic Impact Payment automatically.
Special Alert for Social Security, SSDI, and SSI Recipients with Dependent Children
On Monday, April 20, the IRS announced that anyone who is receiving their Economic Impact Payment solely as a result of their Social Security retirement or SSDI benefits, and who has a dependent child under the age of seventeen, needed to enter their information into the IRS Non-Filers: Enter Payment Information page no later than Wednesday, April 22 at 12 p.m. ET in order to receive the additional $500 payment per child this year. SSI recipients have a later deadline, but we strongly recommend entering your information as soon as possible. If, for some reason, you were unable to enter your information by April 22 at 12 p.m. ET, you will still be eligible to receive the $500 dependent child addition, but you'll just have to wait longer for it. If the IRS did not receive your information by April 22 at 12 p.m. ET, you will need to file a tax return for tax year 2020 in order to receive the $500 for each dependent child in 2021.
On April 21, 2020, the National Federation of the Blind, along with 140 other organizations, signed on to a letter to Steven Mnuchin (Secretary of Treasury), Andrew Saul (Commissioner of the Social Security Administration), and Robert Wilkie (Secretary of Veterans Affairs) asking the agencies to eliminate the Wednesday, April 22, noon deadline and issue payments on a rolling basis, so that more people would be able to enter their information into the IRS site.
Please note that this announcement does not affect your Economic Impact Payment of $1,200. You will still receive that automatically. Entering your information is strictly related to the timely receipt of your $500 per eligible dependent child and is solely applicable to Social Security retirement, SSDI, and SSI recipients. If you do not have any dependent children, then no action is needed. If you filed a 2018 or 2019 tax return and are expecting an Economic Impact Payment, this message does not apply to you, and you should receive your payment as expected.
The standard Economic Impact Payment for most people will be $1,200. This amount will change depending on certain factors. The first factor is your AGI.
- AGI less than $75,000 will receive the full $1,200 payment
- For every $100 above $75,000, your EIP will be reduced by $5
- Example: If your AGI is $75,100, your EIP will be $1,195, and so on
- If your AGI is $99,000 or above, you will not receive an EIP
- AGI less than $150,000 will receive the full $2,400 payment
- For every $100 above $150,000, your EIP will be reduced by $5
- If your AGI is $198,000 or above, you will not receive an EIP
Head of Household
- AGI less than $112,500 will receive the full $1,200 payment
- For every $100 above $112,500, your EIP will be reduced by $5
- If your AGI is $136,500 or above, you will not receive an EIP
The second factor that will affect the amount of your Economic Impact Payment is whether you claim dependents on your tax return. For every qualifying child age 16 or under, an additional $500 will be added to the Economic Impact Payment. Individuals who are eligible to receive an Economic Impact Payment but are not required to file a tax return will still be able to receive the $500 per child addition, but you will need to enter your information into the IRS website. This is an update to previous IRS guidance from April 1, 2020. Please note, if you are claimed as a dependent on someone else's tax return, you will not receive an Economic Impact Payment.
The Economic Impact Payment will be deposited directly into the same banking account reflected on the most recent tax return filed. In the coming weeks, the Treasury Department plans to develop a web-based portal for individuals to provide their banking information to the IRS online, so that individuals can receive payments immediately as opposed to checks in the mail.
Economic Impact Payments are considered unearned income and will not affect one's Social Security Disability Insurance (SSDI) benefits.
The Economic Impact Payments will also not affect benefits received under the Supplemental Security Income (SSI) program as long as the funds are spent within twelve months after they are received. If one has not spent the funds within twelve months, the funds will be considered resources and could cause beneficiaries to exceed the applicable resource limit ($2,000 for individuals and $3,000 for married couples).
For more information on Economic Impact Payments, please visit https://www.irs.gov/newsroom/economic-impact-payments-what-you-need-to-know.
To track your Economic Impact Payment, please use the IRS Get My Payment tool.
(Updated April 16, 2020)