The coronavirus has changed the way we do things and that includes tax preparation. We realize it is a serious illness and we understand you not wanting to jeopardize your health for any reason. In difficult times like these, we also understand that people need their refund. For those who want to have the taxes prepared without jeopardizing their health, we have a secure way to complete the entire process without you leaving the comfort of your home. We can provide you a secure client portal to exchange confidential tax documents and obtain your signature on your tax forms. There is no additional cost to use this service.
If you would like to use this service or have any questions concerning this service, please call us at 205 251-9013 or 205 836-8993 or you can contact us by email. Our email address is email@example.com.
The CARES Act – Stimulus Payments
The stimulus payments that has everybody talking was made possible by the Coronavirus Aid, Relief, and Economic Security Act (CARES ACT) that passed by Congress and signed into law on March 27, 2020. The most urgent question on everyone’s mind is how much of the stimulus payment they will receive and when will they get it? As a note of caution – while the Act has passed and we have the basics of what is provided, until we receive guidance from the Internal Revenue Service there are still many unknowns on how this is going to administered.
- When will the stimulus payments come out? It is anybody’s guess. The Treasury Secretary said by April 6th; the IRS is saying three to four weeks; past experience with rebate checks has shown that a month is more realistic.
- If the taxpayer received a refund on their 2019 (or 2018) tax return using a bank product, and the funds were direct deposited into their bank account or debit card, then the stimulus payment will be mailed to the address on file. If the taxpayer did not use a bank product, and the funds was deposited by the IRS, the stimulus payment will be deposited into the same account.
- In the coming weeks, Treasury plans to develop a web-based portal for individuals to provide their banking information to the IRS online, so that individuals can receive payments immediately as opposed to checks in the mail.
- There are income limitations for the stimulus payment – for single taxpayers with an AGI under $75,000 they will receive the full stimulus payment of $1,200; between $75,000 and $99,000 there is a sliding scale; and no stimulus payment if the AGI exceeds $99,000. For a married couple the numbers are doubled: under $150,000 AGI they will receive $2,400; between $150,000 and $198,000 AGI there will be a sliding scale; and no stimulus payment if AGI exceeds $198,000. Head of Household limitation starts at $112,500 and fully phases out at $136,500.
- For dependent children under the age of 17, the stimulus payment is $500 (which also phases out depending on AGI). What happens if you have other dependents on your return? The first read is that there will be no stimulus payment for dependents other than qualifying dependent children.
- If the taxpayer is a non-filer then the process is to look at the social security records to see if income has been reported for the taxpayer.
- Recipients of Social Security and veteran’s benefits will also receive the stimulus payment (even if they have not had a filing requirement – and no tax return is required to be filed in order to collect the benefit). The funds will be deposited into the same account their monthly benefit check is deposited.
- The stimulus payment is not taxable.
- The bill also calls for everyone who is eligible for the stimulus payment to have a social security number with an exception for the military.
- If the taxpayer owes the IRS money, the stimulus payment will be sent to the taxpayer; it will not be applied towards any outstanding tax liability.
- BEWARE OF SCAMS. The IRS will not call or email you asking for personal information such as bank account, debit account or PayPal account information, social security number or ask you to pay a fee in order to receive the payment. If you receive a call, do not engage with scammers or thieves, just hang up.
If you have any questions, please call us at 205 251-9013 or 205 836-8993 or consult your tax advisor.