I’m still surprised by the number of questions readers have been asking about the economic stimulus payment. Here are a few of the most frequently asked questions with answers. As always, if you have a question, make sure you ask it in the comments section following the article.
Can I Change my Direct Deposit Information?
The IRS says that you can only change your direct deposit information before the week of April 13th. That means if you are reading this it’s already too late.
What will happen to my Stimulus Payment if my bank account is closed?
If your checking or savings account has been closed the IRS will send you a paper check. The IRS will attempt to send your payment to your closed account. Once the bank notifies them that the account is closed they will issue the paper check instead.
I initially had the IRS send my tax rebate via mail. Can I have them direct deposit my stimulus payment?
No. In order for the IRS to direct deposit your stimulus payment they need to have your direct deposit information on your tax return.
How is the payment calculated? How much will I get?
The IRS uses a few simple rules to calculate how much you will get.
- You have to show at least $3000 of income on your tax return. This income can be from wages, self employment, Social Security benefits, VA benefits or combat pay.
- If you meet the criteria above, you automatically qualify for the minimum $300 payment. To qualify for more, you had to pay taxes to the government.
- The amount you receive over the base amount of $300, is based on your tax liability. If you had more than a $300 tax liability (you paid more than $300 in taxes) then you will receive the full $600 ($300 base + $300 tax liability) .
- The most any one individual will receive is $600.
- If you have one or more children under 17 you may receive $300 for each of those children.
- If your adjusted gross income is over $75,000 (single) or $150,000 (filing jointly) your stimulus payment will be reduced. The reduction is 5% of the amount over the $75,000/$150,000 limit.An example from the IRS site:
An individual with AGI of $80,000 and federal income tax liability in excess of $600 would qualify for a basic rebate of $600. Because this individual’s AGI exceeds $75,000, however, her rebate is reduced by $250 (the credit is reduced by multiplying the amount of AGI over $75,000 by 5%). The taxpayer receives an economic stimulus payment of $350.
Can a Dependent Claim Their own Stimulus Payment?
It does not appear that way. The IRS says that a person does not qualify if “they can be claimed as dependents on someone else’s return.” So if you have children over 17 but you claim them as dependents you are out of luck in two ways. First, you won’t receive the $300 credit for qualifying children. Secondly, your dependent won’t get a payment even though he/she may have qualified by the other rules.
This doesn’t quite seem fair but the rules are pretty clear.
What happens if someone dies? Will their heirs still receive the payment?
If that person was eligible to receive a payment then a check will still be issued. This can happen if the person died after taxes were filed or if a surviving spouse or “personal representative” files the taxes. Check IRS publication 559 for information regarding surviving spouses and personal representatives.
If you have any other questions, make sure you ask it in the comments below. I’ll try to find an answer for you or at least point you in the right direction.