Dec 28, 2020 Stimulus Payments- Round 2
As we enter our third lockdown and the Israeli government announces a fourth round of elections in 2 years, some good news—Americans will be receiving a second round of stimulus checks from the US government.
Here’s what you need to know:
How much is the payment?
$600 per taxpayer and dependent under the age of 17. Similar to the first round, anyone who can be claimed as a dependent does not qualify. There is a possibility that later this week, Congress will vote on a separate bill increasing the payments to $2,000 per person.
What are the income limitations?
Same as for the first round of stimulus payments. The payment amount you will receive is limited based on your income and begins to slowly phase out when your adjusted gross income (AGI) hits the following points: $150,000 for married filing joint, $112,500 head of household, $75,000 for single/married filing separate. Your 2019 income will be used to determine eligibility for the advanced payment, but if you qualify based on 2020 income (and not 2019), you will be eligible when you file your 2020 tax return.
What if I have an ITIN?
Taxpayers with ITINs still do not qualify to receive the payment. However, one significant change in this new bill is that taxpayers with ITINs no longer disqualify the taxpayers with valid SSNs included in the filing. This means that if a taxpayer with an SSN files jointly with a spouse who has an ITIN and kids under 17 with SSNs, they would receive payments for the SSN spouse and kids. This change is retroactive to the first stimulus payment, and when you file your 2020 tax return, you will be able to claim even the first stimulus that you may have originally been disqualified from.
How will I get the payment?
If, after January 1, 2019, you used a bank account to direct deposit a refund or debit a tax payment, the IRS will use that account to deposit your stimulus payment. This is another change from the first round of stimulus payments, where they only used bank accounts that had previously received refunds. If you have no bank account on file, they will mail a check to your last known address. It is unclear whether they will use bank accounts previously submitted on the IRS site for the first round of payments.
What if I didn’t file a 2019 return?
IIf you didn’t file because your only income was Social Security benefits, they would use information from the Social Security Administration to send the stimulus. Otherwise, you will need to wait until you can file your 2020 tax return, and the amount you are due from both stimulus payments will be calculated there. The IRS may open up a non-filers application again, but we will need to wait and see.
What if I did not yet receive the first round of stimulus payments?
The non-filers application on the IRS website is currently closed, so at this point, you will need to wait to file your 2020 tax return, and your stimulus payment will be calculated as part of the tax return. You will then be able to get any stimulus relief you were due as a refund.