What’s the deal with the stimulus? No images? Click here Tax Prep Dispatch: Signed, Sealed, Delivered?Editor's Note: This edition of the Tax Prep Dispatch was written by Justin Chu, Senior Program Associate for Prosperity Now. Late last week, Congress approved a record-breaking $2 trillion stimulus package. If you have not yet updated yourself about the new package, check out the full funding breakdown from Politico. A massive part of this stimulus package allocates money to taxpayers in order to boost the economy. This e-mail will assist you in diving into the stimulus payment, and how it impacts low- and moderate-income taxpayers. The BasicsThe bipartisan stimulus package will send $1,200 to taxpayers making less than $75,000 ($2,400 for married taxpayers making less than $150,000) and an additional $500 per child under age seventeen. For Head of Household filers, the income limit surges to $112,500. After the initial income threshold, the $1,200 benefit will diminish at a rate of $5 per $100. This calculator can help shed some light on the potential stimulus benefits for taxpayers. The income level will be based filed 2019 or 2018 tax returns, or eligible Social Security payments. In order to receive the payments, the taxpayer must also have a Social Security Number. This means undocumented workers are ineligible to claim the stimulus check. For filers who have used direct deposit for either of the aforementioned tax years, their stimulus check will arrive via direct deposit sometime in April. Taxpayers will have to wait longer in order to receive their disbursements in the form of a live check. Quick Facts
What Should Taxpayers Do Now?Many taxpayers have experienced varying levels of anxiety regarding the news of the stimulus package, and meeting criteria that allows the full extent of the payment. Luckily, if taxpayers have already filed their 2019 tax return, they will not need to do anything else as the refund check will be processed with all the necessary information. If you have clients that have not yet filed for 2019 but have filed for 2018, they do not have to file for 2019 to claim the rebate unless their 2019 return would create a more favorable rebate situation. In addition, taxpayers can check for updates from the IRS to find out more on what to expect on this fast-moving process. Finally, please be sure to keep yourself up-to-date on the FTC's guidelines on the latest scams targeted around the COVID-19 crisis. The closure of VITA/TCE sites, as well as LITCs across the country, have made the filing process difficult for those who have not yet filed their 2019 returns. As a response, The Taxpayer Opportunity Network created an Alternative Tax Prep Options page that can be found within Prosperity Now's COVID-19 Resources directory. This resource directory will be updated regularly, so please continue to check back for new additions. As always, Prosperity Now will continue to connect you, and the clients you serve, to the necessary tools to assist you in moving forward. |