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Started By
Message
re: Some Stimulus Check Answers (and other issues)
Posted on 3/26/20 at 9:48 am to BilJ
Posted on 3/26/20 at 9:48 am to BilJ
quote:
So how does this work? Do I need to file anything to get my check?
Technically, the checks are advances of refundable credits. Treasury will advance your check based on your most recently filed tax return (2018 or 2019 tax return). If you haven’t filed a tax return, the bill allows Treasury to use the information on your 2019 Form SSA-1099, Social Security Benefit Statement, Form RRB-1099, Social Security Equivalent Benefit Statement.
Okay, I don’t understand. What is a refundable tax credit?
The check acts like a refund you get in advance. When you file your 2020 tax return, the IRS will compare your income numbers. If you should have gotten more than you did, you’ll get a refund. If the numbers on your 2020 tax return are different from your 2019 tax return, I don’t expect that you’ll have to pay it back (as the bill is written now). Don’t worry: most taxpayers should get just the right amount.
Is my check taxable?
No. This is not taxable income.
This post was edited on 3/26/20 at 9:49 am
2
Posted on 3/26/20 at 9:53 am to BilJ
quote:
Okay, I don’t understand. What is a refundable tax credit?
The check acts like a refund you get in advance. When you file your 2020 tax return, the IRS will compare your income numbers. If you should have gotten more than you did, you’ll get a refund. If the numbers on your 2020 tax return are different from your 2019 tax return, I don’t expect that you’ll have to pay it back (as the bill is written now). Don’t worry: most taxpayers should get just the right amount.
Is my check taxable?
No. This is not taxable income.
That's what I'm still leery of. I don't wanna accept anything from the gov it's going to screw my taxes in 2020.
Posted on 3/26/20 at 9:53 am to BilJ
quote:
If you should have gotten more than you did, you’ll get a refund.
and what if you owe? That add it on top?
Posted on 3/26/20 at 9:59 am to jdd48
doesn't look like you get a choice in accepting it though 
which is why I seriously doubt you'll end up having to pay it back.
which is why I seriously doubt you'll end up having to pay it back.
Posted on 3/26/20 at 10:01 am to LSUFanHouston
quote:
This would be a situation where your advance payment wouldn't include the $500 for your second kid, but you would instead get it as a credit / refund on your 2020 tax return, that you file next year.
Same situation but I've already filed my 2019 taxes. Would I get the additional $500?
Posted on 3/26/20 at 10:02 am to BilJ
quote:
doesn't look like you get a choice in accepting it though
which is why I seriously doubt you'll end up having to pay it back.
I'll be interested in seeing what happens. There's a fair bit of doctors out in the world who finished residency in 2019 with an income that qualifies for the stimulus check, and now make 150k+ as attendings.
Posted on 3/26/20 at 10:05 am to DayBowBow
quote:
Same situation but I've already filed my 2019 taxes. Would I get the additional $500?
Yes, it looks like they will now use 2019 if you filed 2019, if 2019 not filed, they will use 2018.
Posted on 3/26/20 at 10:13 am to BilJ
I read an article that you don’t even have to pay taxes on it. So you won’t be paying anything back on it
Posted on 3/26/20 at 10:16 am to tylercsbn9
well no its not taxable income but as some are reading it, they'd technically be paying it back as it could reduce your refund for your 2020 return
quote:
The advance payment will reduce the amount of credit on the 2020 return. It's not known yet what happens if the reduction of the credit is to below zero.
Posted on 3/26/20 at 10:19 am to tylercsbn9
quote:
So you won’t be paying anything back on it
Yes, but does this mean your 2020 tax refund would essentially be a wash and you wouldn’t get your normal return back?
Posted on 3/26/20 at 11:00 am to shutterspeed
quote:
Yes, but does this mean your 2020 tax refund would essentially be a wash and you wouldn’t get your normal return back?
The senate bill as passed, and awaiting action in the house, doesn't specifically spell out what happens if your advance payment > actual recovery tax credit.
It's hard for me to imagine the Treasury saying "nah we're good" but there's been a lot of things lately that surprise me.
For comparison, those with marketplace health insurance plans, use a similar system. The credits (which bring down the cost of insurance) are advance payments. At the end of the year, you have to true it up. If you got less than you should, you get additional money with your return (increased refund / less money owed). If you got too much during the year, you have to repay it back, but, there are caps on how much you have to pay back. I've had several clients over the years that expected a refund, and end up having to write a check, at tax time, because of this.
Posted on 3/26/20 at 11:28 am to LSUFanHouston
quote:
For comparison, those with marketplace health insurance plans, use a similar system. The credits (which bring down the cost of insurance) are advance payments. At the end of the year, you have to true it up. If you got less than you should, you get additional money with your return (increased refund / less money owed). If you got too much during the year, you have to repay it back, but, there are caps on how much you have to pay back. I've had several clients over the years that expected a refund, and end up having to write a check, at tax time, because of this.
Right but those people are going out and choosing to accept that advance premium. This they're sending out to taxpayer's regardless of whether or not they want/need it. I don't see that going well if people find out they owe as a result of something they didn't ask for.
This post was edited on 3/26/20 at 11:30 am
Posted on 3/26/20 at 11:47 am to BilJ
When that “free” money arrives, people better be all like:
Posted on 3/26/20 at 1:26 pm to shutterspeed
Which would be fine but makes me want to save it even moreso now and not spend like they want us to. Personally, its going into savings anyway. Im sure we’ll owe it back eventually.
Posted on 3/26/20 at 1:36 pm to BilJ
quote:
Right but those people are going out and choosing to accept that advance premium.
Up until recently, they had to have insurance or get penalized.
Posted on 3/26/20 at 1:47 pm to LSUFanHouston
I have an 18 yr old in college and a 17 yr old in HS. So nether count as a dependent?
Posted on 3/26/20 at 1:47 pm to LSUFanHouston
How does affect an hourly employee who gets cut back to something like like 40k base, but averages over 80k with normal OT. A person like that is losing over half their income, but is still employed.
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