The Coronavirus Aid, Relief, and Economic Security (CARES) Act has officially been signed into law, and understanding the implications for you and your household can get a little confusing with so much information being thrown at you.
Fortunately, the individual stimulus is pretty straight forward. Individuals will receive $1,200 if their adjusted gross income in 2019 was less than $75,000, while married couples will receive $2,400 if their adjusted gross income was less than $150,000. If you have not filed your 2019 taxes, they will base your eligibility on your 2018 taxes. If you made more than these thresholds in whichever year they are basing your calculation on, the stimulus amount you receive gradually decreases based on your income until it ultimately phases out at $99k AGI for individuals, $145k AGI for head of household filers, and $198k for married filers.
Additionally, for each minor dependent child you will receive $500, subject to the same income limitations.
A few important things to note:
- If you have not filed your 2019 or 2018 taxes, you should not expect to receive any money.
- This process could take several weeks or even months--the stimulus money may not be disbursed until as late as June or July.
- If you are receiving social security or similar benefits, you will receive the stimulus as a direct deposit into the same account you receive your benefits.
What if I made too much in 2018 and 2019, but in 2020 my income dropped significantly due to the coronavirus pandemic and the resulting loss of work?
If you were not eligible for the stimulus based on your 2018/2019 taxes, but in 2020 your income drops off to a below the threshold level, you can claim the stimulus money as a credit on your 2020 taxes.
How does the stimulus impact small businesses?
Check out our article on the impacts of the CARES Act on Small Business to learn more.