The first round of stimulus from March 2020 made payments of up to $1,200 to eligible individuals. This new round will pay additional stimulus amounts of up to $600 to all eligible individuals. However, there are some caveats, which we will explain in greater detail for you.
A Quick Explanation of Round 2
By basing these new stimulus amounts on 2019 tax return filing status and Adjusted Gross Income (“AGI”):
- Single tax filers with AGI up to $75,000 will receive $600
- Head of Household Filers with AGI up to $112,500 will receive $600
- Married Filing Jointly filers with AGI up to $150,000 will receive $1,200
In all cases, filers are eligible for an additional $600 per person for each qualifying child under the age of 17.
If AGI exceeds the above thresholds, it reduces the total payment by 5% of the amount of the AGI above the threshold. The chart below (courtesy of www.kitces.com) shows the expected payment amount(s) for various filing statuses, number of qualifying children, and AGIs.
Treat these funds as a refundable credit, not as taxable income. The following chart breaks down how the amount you received may change if your income was lower in 2020 than in 2019:
Wondering When to Expect Your Second Stimulus?
You may have already received it! Some people began receiving these as early as last night. However, the IRS has a Get My Payment tool available, with which you can utilize to check on the status of your payment at any time.
We know this all can be confusing, so if you still have questions about this or anything else, please feel free to reach out to us. We'd love to chat!
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