On March 27, 2020 the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law. This is a $2 trillion-dollar economic recovery package that offers relief to individuals, and small and large businesses affected by the COVID-19 virus. The CARES Act provides for one-time Economic Impact Payment to help people who are struggling with the financial impact of the pandemic.
How Much Money Will I Receive?
The CARES Act provides for an Economic Impact Payment to help taxpayers recover from the economic impacts of the coronavirus crisis.
- The maximum rebate is $1,200 for individuals and $2,400 for married taxpayers filing taxes jointly.
- An additional $500 rebate is available per child claimed as a dependent on your tax return.
- The payment amount is reduced by five percent (or $5) of the taxpayer’s Adjusted Gross Income (AGI) for every $100 above the following thresholds:
- $75,000 for single (or married-filing-separately) taxpayers
- $150,000 for married-filing-jointly taxpayers
- $112,500 for head-of-household taxpayers
Below are some Examples:
|Filing Status||Adjusted Gross Income||Children||Total Recovery|
|Married Filing Joint||$100,000||4||$4,200|
|Married Filing Joint||$80,000||0||$2,400|
Click here to calculate your cash assistance amount.
Who Is Eligible for the Economic Impact Payment?
The CARES Act includes a requirement that you must have Social Security number (SSN). Therefore, many immigrants and mixed–immigration status families will not receive this financial assistance. If you filed your most recent income tax returns with a “Tax ID” or “ITIN” you are not eligible. It is not clear if people who filed their taxes with Tax IDs and claimed children with social security numbers will receive the $500 cash assistance for their children. We are waiting on guidance from the IRS.
- Individual filers and couples filing jointly must have been issued SSNs that are valid for employment by the time they file their qualifying return.
- Children claimed as dependents for the $500 rebate must also have valid SSNs.
- If both partners in a married couple used an Individual Taxpayer Identification Number (ITIN) to file their taxes, no one in the household is eligible for the return, regardless of whether they file jointly.
- For mixed–immigration status married taxpayers (where one taxpayer has an SSN and the other taxpayer has an ITIN), the couple would need to file 2019 taxes separately in order to claim the rebate for any eligible household members. Taxpayers should consult professional tax preparers about the best options for their unique household situation.
- To receive the payment, taxpayers and any children claimed will also need to be “resident aliens,” which basically means that if they are not a U.S. citizen or lawful permanent resident, they reside primarily in the United States.
How do I get the payment?
The payment is issued automatically — you do not need to apply for it. It will be estimated based on a person’s most recent tax returns. There is currently no way to “apply” for the rebate if someone does not file tax returns or receive Social Security benefits, which excludes many low-income who either are not required to file tax returns because they earn too little or have not been able to file tax returns. Taxpayers should note the following:
- If you have not yet filed a FY 2019 tax return, your eligibility will be based on your earnings, SSN status, and the number of eligible child dependents on your FY 2018 return.
- If you earned less than $12,200 and did not file taxes, click here to complete the Non-Filer form in order to obtain your payment.If you have not filed a tax return recently but do receive Social Security benefits, your payment will be estimated based on your SSA-1099 Social Security Benefit Statement or form RRB-1099 Social Security Equivalent Benefit Statement. This process only applies to Social Security Retirement or Social Security Disability Insurance (SSDI) beneficiaries and not to recipients of other programs such as Supplemental Security Income (SSI) for low-income seniors or people with disabilities.
- If you were not eligible for a benefit in the 2018 tax year, but became eligible in 2019 or FY 2020, there will be a future process to reconcile the payments based on updated eligibility. If you were ineligible in 2018 because you filed jointly with your spouse and one of you does not have a valid SSN, you can file separately in 2019 to claim the payment.
- As a reminder, the IRS has extended the deadline to file FY 2019 taxes and pay any amounts due to July 15, 2020.
The U.S. Treasury Department aims to issue these checks as quickly as possible, beginning in mid-April. As soon as your eligibility is calculated, the IRS will deposit your payment into bank accounts listed for 2019 (or 2018) automatic refund deposit authorizations or mail you a check to the address on file.
Will Receiving a Recovery Rebate Impact My Immigration Application under the Public Charge Rule?
No. The Economic Impact Payment is considered an advanced tax credits to be disbursed by the Treasury Department. The DHS final rule on inadmissibility on public charge grounds is clear that tax credits are not taken into account for the purpose of a public charge determination.
DHS said that only public benefits as defined in in their rules will be considered in the public charge inadmissibility determination. They define a public benefit to include programs like Medicaid and cash assistance for income maintenance, however the rules indicate that cash assistance for income maintenance does not include tax credits. Furthermore, USCIS indicates in their Policy Manual that tax credits are not considered public benefits in a public charge inadmissibility determination.
Do you have questions about the Economic Impact Payment? Call our office 404-975-1241 and we will help you determine if you are eligible for this benefit.
Founder, Solano Law Firm
IRS Economic Impact Payment: https://www.irs.gov/coronavirus/coronavirus-tax-relief-and-economic-impact-payments-for-individuals-and-families