How Do I Get My $1,200 Coronavirus Relief Check? (Best Tips)

The Internal Revenue Service’s big headline read, “No action needed by most people at this time”. But we now have more information that our earlier blog on the $1200 checks.

The IRS says that the first of the $1,200 Coronavirus relief payments will be sent sometime during the next 21 days, presumably by April 20, 2020.

According to IRS, receiving these “economic impact” payments do not require that recipients take any actual steps. The checks will be distributed automatically. At least, they should be sent out for most people.

For people who have already filed their 2019 tax returns, the IRS will use their tax return information to calculate the payment amount. Any payment will be based on your 2019 Filing Status and Adjusted Gross Income (“AGI”).

If you have not yet filed your 2019 tax return, the IRS will use your filed 2018 tax return information to determine the payment. Remember, the 2019 tax filing deadline was extended until July 15, 2020. A large number of people have not yet filed that year 2019 tax return.

Your AGI is found on Line 7 of your 2018 Form 1040 tax return.

We are getting so many inquiries about these payments. Here are answers to the most common questions.

Q: Am I eligible for the COVID relief payment?

These are the requirements:

• You must have filed a tax return for 2019 (or at least for 2018).

• If you were a single filer on your 2018 tax return, and your adjusted gross income (“AGI”) was greater than $99,000, you are not eligible to receive any amount. By “single filer”, we believe this means anyone that did not have filing status “Married Filing Jointly”.

• If you were a joint filer on your 2018 tax return (with no children), and your joint adjusted gross income was greater than $198,000, you are not eligible to receive any amount.

Q: How much am I eligible to receive?

Individuals –

• Who have AGI up to $75,000 will receive the full $1200.

• Who have AGI over $75,000 will receive $1,200, reduced by $50 for every $1,000 that AGI exceeds $75,000. (The $1,200 runs out when AGI reaches $99,000.)

• Those who are parents receive another $500 for each “Qualifying Child”.

Married couples filing joint returns –

• Who have AGI up to $150,000 will receive the full $2,400.

• Who have AGI over $150,000 will start with $2,400, but that amount will be reduced by $50 for every $1,000 that AGI exceeds $150,000. (The $2,400 runs out when AGI reaches $198,000.)

• Those who are parents receive another $500 for each “Qualifying Child”.

Q: What is a Qualifying Child for the relief payment?

IRS will likely use its 4-prong test for a qualifying child for the purposes of Earned Income Tax Credit. That 4-prong test considers the child’s:

• Age;
• Relationship;
• U.S. Residency; and
• The Joint Return test.

However, what exactly will be the definition, we don’t know yet. IRS has not yet finalized that detail.

Q: Where are they going to send my payment?

IRS prefers to make a deposit directly into your bank account. By this plan, this economic impact payment will be deposited into the same banking account shown on the tax return filed.

Again, for people who have already filed their 2019 tax returns, the IRS will use that return’s information to determine the amount, and treatment of the COVID shut down payment. Reminder: The year 2018 tax return information is used if the 2019-year tax return was not yet filed.

Q: The IRS does not have my direct deposit information. So now what?

IRS is not quite sure how this will be handled. The government plans to create a web-based signup, so that people can provide their banking information to the IRS online. Again, IRS prefers to make a deposit directly into your bank account, instead of mailing checks.

This online web-portal is supposed to be ready by mid-late April 2020.

Q: I was not required to file a 2019 or 2018 tax return. How can I receive my payment?

You can still receive a Coronavirus relief payment. Those who normally do not file a tax return must file a simple tax return to receive their economic impact payment. According to IRS’s plan, those who are not otherwise required to file a tax return will not owe tax, simply because they filed a return to qualify for the relief payment.

Usually, this includes:

• Senior citizens,
• Social Security recipients,
• Individuals with disabilities
• Low-income taxpayers (including many working students), and
• Many veterans.

We recommend that you remember to give you current bank account information, for the deposit.

We also recommend that you file either year’s return, immediately. IRS announced that more “How-To/Where-To” instructions would be posted online at IRS.gov/coronavirus. But instead of waiting on that information, we think it is better to just file the tax return electronically. (Electronic e-File is by far the most efficient, and fastest option.)

Remember, one tax return might qualify for better payment than the other. You might give that year’s tax return the earlier priority in filing.

Q: How long do I have to file a tax return, in order to receive this payment?

If you still need to file a tax return, the economic impact payments will be available until December 31, 2020. Again, we recommend that you immediately file either year’s tax return in order to qualify.

Here are some details that are yet to be addressed:

• What if that bank account on the tax return is now closed, or invalid, or no longer accessible?

• What if I prefer not to use banks, but prefer they mail me a check?

• What if I owe the IRS? Will they keep my relief payment?

• Will the COVID shutdown delay my refund?

• How do I know if someone else received my payment?

• Is there any protection against scams?

Answers to these questions are yet unresolved. As we have updates, we’ll keep you informed. And during this time, we wish that you all stay safe and healthy.