by Ashley Burnside
In late March, lawmakers passed a third coronavirus response package called the Coronavirus Aid, Relief, and Economic Security (CARES) Act that offers a first step in essential economic relief for millions of workers and people with low incomes. One component is the economic impact rebate payments. Despite wide news coverage about these payments, many have questions about who’s eligible and how to receive the payments. Below are ten things to know about these payments:
1. The payments will be $1,200 per qualifying adult ($2,400 for married taxpayers filing a joint return) and $500 per child under 17 years old. Children who are 17 years old and older and other dependents, such as those who are permanently disabled, are not eligible for the $500 payment. You will not need to pay back the IRS because the payments are an advance against a new credit. These payments will not affect eligibility for other tax credits.
2. You can’t receive the $1,200 payment if you can be claimed as someone else’s dependent. You can be claimed as someone else’s dependent based on your relationship to the filer, your age, whether you lived with your parents for more than half of the year, and whether you were financially independent for more than half of the year, among other factors. This will affect many full-time college students under age 24. However, it’s important to review the rules, since not all college students are dependents. Here are more details about whether or not a child qualifies as a dependent.
3. You don’t need to have earned income to qualify. Unlike in earlier versions of the bill, the full payment is available to those with little to no income. Even if you are making $0, you can still receive the full payment. The payments phase out at higher income levels, starting at $75,000 for single filers. Here are details on the phase-out rates.
Read the full blog post here.