1. I’ll have to pay the money back next tax season.
False. This “economic impact payment” will not reduce your refund or increase the amount you owe when you file your 2020 tax return next year. You are not alone in believing this myth, though. Because the check is technically considered an “advance refund of a 2020 tax credit,” many began viewing it as a loan. But rest assured, this money is completely unrelated to your taxable income and it is yours.
Once your 2020 taxes are calculated next year, you may even be entitled to more money. If you make less in 2020 than you did in 2019, you may qualify to receive any remaining credit you were not able to take in 2019. On the other hand, if you made more money in 2020 and the amount you qualify for at the end of 2020 is less than you received in 2019, you will not have to pay the money back.
2. The money I get will be taxed.
False. The IRS clearly states that the money is not considered income, so you will not owe taxes on this payment. However, remember that some other relief payments, such as the additional weekly $600 benefit funded under the Federal Pandemic Unemployment Compensation, will be taxed.
3. I can’t track the status of my check.
False; you can! The IRS has created a page to help you do that. Click here to track the status of your stimulus check.
4. If I have never had money from the IRS direct deposited, it will take months until I get my check.
While it is true that those who have never shared their banking information with the IRS will have a to wait a few more months to get their stimulus check, there is a way you can receive it sooner. When you go to the “Get My Payment” page on the IRS website, you will have the option to track your payment as well as set up direct deposit with the IRS. This should get you your check sooner than if you had to wait for it to arrive in the mail.
5. If my AGI exceeds the threshold, I will not get a stimulus check.
False. The cut off isn’t a hard cut off, but instead, if you earn over the AGI threshold you will still receive a partial stimulus check. For example, the payment for taxpayers who make between $75,000 and $99,000 will decrease by $5 for every additional $100. You can use a stimulus check calculator to get an estimate of how much your check will be.
As time passes, we’ll likely have more myths to debunk regarding further relief aid. So stay tuned! Although our physical office is closed during this lockdown, we are always available to help taxpayers like you, so feel free to reach out.