Coronavirus (COVID-19) Tax Impact - Will you get a stimulus check? Explaining the $2 trillion stimulus package

After much debate, Congress passed the highly-discussed stimulus package on March 27, 2020. The $2.2 trillion coronavirus stimulus package, named the CARES Act, includes aid to Americans via direct cash assistance, additional unemployment income, and additional business tax credits. Because the CARES Act is a 880 page legislative document, I thought it would be helpful to provide a quick summary detail about the stimulus package. Namely, I will focus on the direct cash assistance portion of the bill as this seems to be the area that interests most individuals. So, if you want to learn about the stimulus checks, please continue to read below where I answer some frequently asked questions about the coronavirus stimulus check including:

Will I get a stimulus check from the coronavirus stimulus package?

Am I eligible for the stimulus check?

When will I receive the stimulus check?

How to maximize my stimulus check?

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Stimulus Checks - What to know about the stimulus checks

Will I receive a stimulus check?

As I stated, many people are eager to learn about the direct cash assistance, or stimulus check portion of the CARES Act. The stimulus checks will only be available to eligible Americans. Eligibility is based on your tax return. If you have filed your 2019 tax return (Learn how to file your 2019 tax return for free), the IRS will utilize your 2019 tax return. However, if you have not filed your 2019 tax return, the IRS will utilize your 2018 tax return. Therefore, you have the ability to strategize to maximize your stimulus check benefit if you have not filed your 2019 tax return. More on that later.

The eligibility for the coronavirus stimulus checks is based on your gross income/AGI reported on your utilized tax return. This is essentially your income before below the line tax deductions (Learn how to calculate your taxable income). The link provides an extensive list of items included in adjusted gross income, but some common examples include: salary, wages, bonuses, tips, dividends, and interests.

You will receive the full stimulus check benefit if you make $75,000 or less ($150,000 MFJ, $112,500 HoH). It is important to note that the threshold amount for filers with children increases with each dependent child. The stimulus check benefit will phase-out if your taxable income amount exceeds the stated amounts. The benefit phases to zero if you earn $99,000 ($198,000 MFJ).

If you are claimed as a dependent on someone else's tax return, you are not eligible for the stimulus check payment.

How much is the stimulus check?

The maximum stimulus check is $1,200 for each individual. If you file jointly, the benefit is increased to $2,400. Additionally, for those with dependent children, you will receive an additional $500 per child under the age of 17 years old.

When will I receive the stimulus check?

The answer to this question is unclear. In order to avoid being wrong, the government has not announced an official date for the stimulus checks. The Treasury Secretary stated that he hopes the stimulus checks will be available to individuals within three weeks.

If you enrolled in direct deposit on your previous tax return, you should receive the checks within a couple of weeks most likely. If not, you may have to wait longer for the mailed checks to arrive at your address.

How to maximize my stimulus check benefit?

As I stated, if you have not filed your 2019 tax return, you need to act fast to ensure you receive your maximum benefit. To maximize your stimulus check, you need to determine which tax return, 2018 or 2019, will yield the bigger stimulus check payment. If your 2018 tax return will yield the larger stimulus check payment, then you should wait to file your 2019 tax return until you have received the stimulus check. If your 2019 tax return will yield the larger stimulus check payment, you should quickly file your 2019 tax return.

Some areas to consider when determining which tax return will yield the larger stimulus check payment include: your AGI, your filing status, and your number of children. After those considerations, you should be able to maximize your stimulus check benefit.

Please share with others to help them learn about the $2 trillion stimulus package, and its direct cash assistance element. Are you eligible for the coronavirus stimulus check? Please share below as well as comment any questions or concerns you may have about the COVID-19 stimulus check!