It’s official! The U.S. government is sending stimulus checks or direct deposit to most Americans to help families survive financially through this coronavirus crisis.
The 2 trillion dollar stimulus package states that individuals making $75,000 or less per year would get the full stimulus amount of $1,200.
Married couples who file their taxes jointly that make less than $150,000 combined income would get $2,400.
Those that make above these amounts can still receive a stimulus check, but it will be prorated. Meaning it will not be as much.
The Coronavirus stimulus check also adds $500 for each qualified child under the age of 16.
Use our stimulus check calculator below to see how much will likely receive.
We highly recommend opening a high yield savings builder account with CIT Bank paying 1.70% with your stimulus money.
Continue reading to see all of the answers to the most frequently asked questions about the coronavirus stimulus checks.
Who Will Get These Stimulus Checks?
Here are the specific income qualifications:
- Income is based on people’s tax filings for 2019, but they have not filed for that year, then their filing for 2018 applies
- Maximum adjust gross income for individuals of $75,000 to get a full check
- Maximum adjust gross income for married-filing-joint couples of $150,000 to get a full check
- Maximum adjust gross income for head of household of $112,500 to get a full check
- Check reduced by $50 for every $1,000 over of the maximum adjusted gross income of $75,000 ($150,000 married-filing-joint)
- If you earn $99,000 or more ($198,000 married-filing-joint), you would NOT receive the individual stimulus check. If you earn over $136,500 as head of household, you would NOT receive a check.
If you have any qualifying children under 16, you will also receive an additional $500 per child (max of three).
Who will receive the Economic Impact Payment automatically without taking additional steps?
Most eligible U.S. taxpayers will automatically receive their Economic Impact Payments including:
- Individuals who filed a federal income tax for 2018 or 2019
- Individuals who receive Social Security retirement, disability (SSDI), or survivor benefits
- Individuals who receive Railroad Retirement benefits
Who should use Non-Filers: Enter Payment Info to provide additional information to receive the Economic Impact Payment?
Eligible U.S. citizens or permanent residents who:
- Had gross income that did not exceed $12,200 ($24,400 for married couples) for 2019
- Were not otherwise required to file a federal income tax return for 2019, and didn’t plan to
You can provide the necessary information to the IRS easily and quickly for no fee through Non-Filers: Enter Payment Info. They will use this information to determine your eligibility and payment amount and send you an Economic Impact Payment.
After providing this information you won’t need to take any additional action.
How Much Money Will I Receive?
The current proposal gives specific amounts per qualifying taxpayer.
Here’s a quick summary of the COVID-19 stimulus package:
- $1,200 check sent to individual taxpayers who meet the income qualifications
- $2,400 check sent to married-filing-joint couples who meet the income qualifications
- $500 additional for each qualifying child in the household
If you earn over the income qualification amount, you will receive $50 less per $1,000 over.
For example; If your adjusted gross income for 2018 was $85,000, you are $10,000 over the income phaseout of $75,000. Meaning your stimulus check would be reduced by $500. You would receive a $700 stimulus check.
How Will I Get My Stimulus Check?
Payments, according to the bill, will be made “as rapidly as possible”.
For the roughly 70 million Americans that have already provided their direct-deposit bank account information to the IRS, rebates could be sent in just a couple of weeks.
But those who haven’t provided direct deposit information may have to wait up to four months for their checks to arrive. This really defeats the purpose of this stimulus bill’s intention of providing financial assistance to many struggling Americans as soon as possible.
A notice will be sent to the person’s last known address within 15 days of payment informing them of the method and amount of payment. A phone number will also be provided so people can call the IRS in the event they did not receive it.
When Will I Get My Stimulus Check?
Payments started being sent April 13th. If you’ve filed your 2019 taxes and have entered direct-deposit information, you should receive your money within a week or two.
Direct deposit is the fastest way to get your stimulus payment. Paper checks can take anywhere from 2-3 weeks longer to receive. If you’ve set up your refund to come on a prepaid card or tax advance loan, you are likely to get a paper check.
Can I Update My Information For Direct Deposit?
The IRS is working with the Treasury to create a website specifically for the stimulus relief. It should include a place to update direct deposit information in the future.
If you want to access the Coronavirus Tax Relief website you can do that here.
Are These Stimulus Checks Taxable?
No these payments are considered rebates. However, for those who have yet to file their 2019 income taxes, the rebates will be based on their 2018 income levels.
That means you could be subject to adjustment once you finally file your 2019 taxes, depending on whether you received too large or too small a rebate based on your most recent income levels.
What About People on Social Security?
Anyone on Social Security is eligible to receive the coronavirus relief payment as long as their total income does not exceed the limit.
Low-income Americans on Social Security do not need to file a tax return. As long as they received an SSA-1099 form, the federal government will be able to send the payment via the same way they get their Social Security payment.
Those who normally receive their benefits directly in their bank account will receive the stimulus money in the same way. Others will receive a check in the mail but expect it to take much longer than a direct deposit.
Retirees and people on disability are both eligible for the special payment.
What about people who owe money to the IRS for prior years?
Other IRS liabilities won’t come out of the payments and even people who owe back taxes should get the full amount they qualify for.
What about child support?
The normal IRS rules for child support and tax refunds will apply, which means that refunds for people who are behind on those payments may be smaller.
Do children born in 2020 get the payment?
Parents of children born this year won’t get a payment for that child now.
Read the Entire Coronivirus Stimulus Bill
If you still have questions feel free to ask them in the comment section below.
You are also more than welcome to head here to read 2020 coronavirus stimulus aid bill.
What Should I Do With My Stimulus Check?
The money you receive during the corona pandemic should be used to get you through the financial struggles our entire nation is currently facing.
Whether you have lost your job, have reduced hours, or are working from home it’s important to take this extra money seriously.
Click here to grab our exclusive Budgeting Binder to finally help you create a money plan you can follow.
Here are the financial moves you should make once your stimulus check arrives.
1) Take Care of the Four Walls
When the going gets tough, just like it is now, you need to focus on the things you really NEED to survive.
We call these the Four Walls. Forget the extra student loan payments, the gym membership, and all of your streaming services (for now). The Four Walls should be your only priority.
These are the basics you need to keep going so you can live to fight another day. It’s impossible to fight for another day when your family doesn’t have food, isn’t it? So if there’s no food in the fridge, don’t pay your cell phone bill.
These are the most important things to focus on making sure you have until we get through this. So everything else gets put on the back burner.
Make sure you start a budget if you don’t have one already so you know exactly where your money is going.
2) Build Up Your Emergency Fund
We say it all the time, be prepared for emergencies. It’s not a matter of if but when will they happen.
The coronavirus is a perfect example of things happening in our life that are out of our control.
But just because they are out of our control does not mean we can’t be well-prepared for them.
If you don’t have a $1,000 emergency fund yet, use your stimulus check to fund it. Open a high yield savings account and put your money away for a rainy day.
If you already have a $1,000 emergency fund take your stimulus check and fully fund it to cover 3-6 months of your monthly living expenses.
For example, we spend around $3,500 per month. So, we have a fully-funded emergency fund of $20,000 that we can turn to if things took a turn for the worst.
3) Pay Down Your High-Interest Debt
If you have consumer debt on credit cards, high-interest student loans, car loans, etc. now is the perfect time to use this extra income from the stimulus check to pay down your debt.
Now is not the time to go out and waste money trying to keep up with the Jones. Use the extra cash flow for your long-term benefit of getting and staying out of debt.
4) Continue Investing
The stock market might be all over the place but now is the perfect time to continue to invest your money and put your money to work long-term.
The market has taken a huge hit and will rebound. You cannot time the market, anyone that tells you that you can is lying to your face.
Continue to make your monthly contributions and let the power of dollar-cost averaging go to work.
If you are new to investing we highly recommend opening a Robo Investment account with Betterment.
5) Start a Side Hustle
Chances are if you are like a majority of the U.S. you have been asked to reduce your hours, work from home, or worst-case scenario been laid off completely.
There has literally never been a better time to start an online side hustle and increase your income streams.
When it comes to making money online the options are endless!
Grab our FREE Side Hustle Guide below and learn how and get started today.
Final Thoughts on the 2020 Stimulus Checks
We are so blessed that we live in America and have a government that is taking action to take care of us.
Be grateful for the things you have, take a deep breath, and get outside for a nice walk to clear your head.
This will all pass and life will return to normal before we know it.
Take this time to really assess your current financial situation. If you are stressed beyond measure with your finances during a crisis like this you need to start making changes.
Learn from this and take action on improving your family’s financial future.