CPA Jamie Block of Mercer Advisors discussed the impact of federal stimulus payments during the COVID-19 pandemic on your 2020 tax return Thursday during News 8 at Sunrise.
ROCHESTER, N.Y. (WROC) — CPA Jamie Block of Mercer Advisors discussed the impact of federal stimulus payments during the COVID-19 pandemic on your 2020 tax return Thursday during News 8 at Sunrise.
"The CARES Act was passed on March 27, 2020," said Block. "One of the provisions of this act allowed for individuals to receive a stimulus payment of $1,200 each and dependent children to receive $500."
Block said there is an income limit that is based on your most recently filed tax return. "If you did not file your 2019 return by the time the payments were processed, then the IRS used your 2018 tax return. The income limit is $150,000 adjusted gross income, or AGI, for married filing joint filers, $75,000 for single, and $112,500 for head of household. If your adjusted gross income is over this amount, the stimulus is reduced by 5% of the amount over your AGI."
There's still time to receive your stimulus payment. "The stimulus is a prepayment of a 2020 income tax credit. Which means if your 2020 income is under the limits previously stated, then you can claim a refundable credit on your 2020 tax return. The credit will offset any tax owed and any excess will be refunded to you."
Block recommends if you did not receive a payment in 2020 and are not required to file a tax return in 2021 for the 2020 tax year to file a tax return anyway to claim your stimulus credit and receive a refund.
For more information about the stimulus payments, visit IRS.gov.
