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CARES Act – Individual Tax Provisions Q&A

Joel B. Hundelt

March 31, 2020

Q: How do I know if I will receive a stimulus payment?

A: If you fall within the filing and AGI guidelines described in the Act, you will receive a payment.

Q: What will be the amount of my stimulus payment?

Please reference the chart below for the threshold and payment amounts:

Q: How will the stimulus payment be distributed?

A: The check will be sent via the same method used on your most recent filed tax return.  If that was direct deposit, then it will be deposited into that account.  If not, a check will be mailed to the address on your most recent filed tax return.

Q: Is the stimulus payment taxable?

A: No, the stimulus payment is not taxable.

Q: When can I expect to receive the stimulus payment?

A: The stimulus payments are expected to be paid within three weeks of the Act’s passing (March 27, 2020).

Q: Will I have to pay back any of my stimulus payment?

A: No, the stimulus payment does not have to be paid back.  In fact, if your initial payment was limited based on AGI, it’s possible you will receive further payment if your AGI decreased in 2020.

Q: Will I still get a stimulus payment if I owe back taxes to the IRS?

A: Yes, the bill suspends nearly all administrative offsets that would traditionally reduce tax refunds for individuals.  The only exception is for individuals that owe past due child support in which the state has reported the past due amount to the Treasury Department.  These individuals may not receive a stimulus payment.

Q: What happens to my credit if I filed a joint return for 2019 but will file as a single filer for 2020?

A: Half of such refund or credit will be considered as having been made or allowed to each individual filing such return for 2020.

Q: What if I haven’t filed my 2019 tax return yet?

The stimulus payment will be based on your 2018 AGI if your 2019 tax return is not yet filed.

Q: Am I still required to take my required minimum distribution in 2020?

A: No, the Act waived required minimum distributions for 2020, regardless of whether you were impacted by COVID-19.

Q: Can I still claim a charitable contribution deduction even if I don’t itemize?

A: Yes, the Act allows an above-the-line deduction of up to $300 in the 2020 tax year, even if you don’t itemize.

To review other provisions from the CARES Act, click here.

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