Government financial aid during pandemic

[cyclone27 710]

Not a loan please ignore previous post.

[Crazy Cat 39,219]

6 minutes ago, cyclone27 said:

Not a loan please ignore previous post.

If it is a tax credit advance, it is like a loan.......is it not?

Edited March 26, 2020 by Lucky Cat

[Unlockable 7,306]

4 minutes ago, Lucky Cat said:

and what if I typically break even after filing.......I will have a $1200 tax liability in 2020?

Don't know the potential of repayment. the example I gave is one example. There  could be reprieve for those who owe. Have to dig deeper.

1 minute ago, cyclone27 said:

Not a loan please ignore previous post.

Yes, it is not a loan, which is why I said it is treated like one an put the word 'loan' in quotations. Just wanted people to not treat this as free money.  So far the wording I am seeing as it will be recovered in the future.

[Unlockable 7,306]

1 minute ago, Lucky Cat said:

If it is a tax credit advance, it is a loan.......is it not?

A lot of people don't understand tax jargon. So the way I describe it is it is "like a loan". I found most people I talked to (friends and family) had a connection to the word loan over tax credit advance. Basically, I plant a seed in their head that this money will be recovered in the future.

[Crazy Cat 39,219]

Just now, Unlockable said:

Basically, I plant a seed in their head that this money will be recovered in the future.

Yea, I now vaguely remember this recovery the last time these payments were issued.......

[NikLR 13,220]

https://www.nytimes.com/article/coronavirus-stimulus-package-questions-answers.html

[geowrian 22,335]

9 minutes ago, Unlockable said:

This stimulus is treated like a "loan", so to speak. Everybody will pay it back in future tax deductions. Do not treat this as free money. For example, if you typically receive $2,000 for your annual tax refund and you get a stimulus check this year for $1200, you next year's tax refund will be $800.

Do you have a source for this? The text of the bill defines it as a refundable credit, with an advance rebate.

https://files.taxfoundation.org/20200325223111/FINAL-FINAL-CARES-ACT.pdf

Quote

(a) In general.—In the case of an eligible individual, there shall be allowed as a credit against the tax imposed

Yes, getting the advance rebate does count against you when you file at the end of the year. But you are also due the credit at the end of the year. You're just getting it sooner. If you did not get it sooner, you would have an extra $1200/adult owed back at the end of the year anyway.

 

https://taxfoundation.org/cares-act-senate-coronavirus-bill-economic-relief-plan/

Quote

The proposed recovery rebates will use 2019 tax returns (2018 if the taxpayer has not filed in 2019) to determine the advanced rebate amount and reconcile the rebate based on 2020 income. This means that taxpayers who receive a smaller rebate than they are eligible for based on 2020 income will receive the difference after filing a 2020 tax return, but overpayments of rebates due to a higher income in 2020 will not be clawed back.

Quote

Policymakers have opted for the design used in the 2001 rebate for distributing the recovery rebates, forgiving any overpayment to taxpayers when they file their 2020 tax returns.

 

8 minutes ago, NikLR said:

https://www.nytimes.com/article/coronavirus-stimulus-package-questions-answers.html

Student loan debts won't be held? Cool...I didn't see that in the updated text yet.

[NikLR 13,220]

That is a news article so take it with a grain of salt.  

I read with the Washington post that you won't have to pay it back next year either. 

I don't personally mind paying it back, we normally get a large return because of how my husband chooses to have his taxes withdrawn.  

[Unlockable 7,306]

50 minutes ago, geowrian said:

Do you have a source for this? The text of the bill defines it as a refundable credit, with an advance rebate.

https://files.taxfoundation.org/20200325223111/FINAL-FINAL-CARES-ACT.pdf

 

I acknowledge that my attempt to use the word loan as a way to advise people to be aware that this may not be free money was not the best method. My sources are from previous stimulus and news sources that was covering this one. I apologize if my initial post has confused people. I tried clarifying in follow up posts.

But I still want to emphasize that until there is definite official word that this stimulus payment will never be recovered from individuals, I strong encourage everyone to treat it as if it will be recovered some time in the future (either through future tax filings or other methods). 

 

https://www.cnbc.com/2020/03/20/heres-how-your-rescue-check-from-the-government-could-be-taxed.html

https://crsreports.congress.gov/product/pdf/IN/IN11247

 

 

[geowrian 22,335]

3 minutes ago, Unlockable said:

I acknowledge that my attempt to use the word loan as a way to advise people to be aware that this may not be free money was not the best method. My sources are from previous stimulus and news sources that was covering this one. I apologize if my initial post has confused people. I tried clarifying in follow up posts.

But I still want to emphasize that until there is definite official word that this stimulus payment will never be recovered from individuals, I strong encourage everyone to treat it as if it will be recovered some time in the future (either through future tax filings or other methods). 

 

https://www.cnbc.com/2020/03/20/heres-how-your-rescue-check-from-the-government-could-be-taxed.html

https://crsreports.congress.gov/product/pdf/IN/IN11247

Gotcha, thanks.

 

I see your point. This is not final yet.

That said, those links talk about hypotheticals on what they ultimately decide to do. They are not an analysis of the bill passed by the Senate and is slated for vote in the House tomorrow, which Trump said he would quickly sign.

[cyclone27 710]

Right now it’s a grant and the senate version has indicated that it will not be paid back or included as income for 2020 tax season. 👍

[Prizm123 1,084]

9 hours ago, Sarge2155 said:

They will add it on to your annual incomes that tax year so in essence you are paying it back. What IRS won't tell you is that if you owe Back child support or any BACK loans and your pay is garnished already it will come out of this stimulus check!!!! Imagine the heartache when you find out your ex got your stimulus check. It happened last time so I'm sure it will happen this time!!!

it might be different now since things like student loans can be pushed back with a forbearance., i am hoping it comes in May actually, by then i will have already paid my taxes and my student loans will be paid off because i dont want the forbearance

[LBee1592 17]

So do you guys think that if a couple files married and jointly, one is a US citizen, one is a resident alien using an ITIN, they would still be eligible?

I have read somewhere that an ITIN could create a problem for both and possible neither one would get money. (Not even the US citizen spouse)

 

Does anyone know anything about this? 

 

https://www.google.com/amp/s/amp.cnn.com/cnn/2020/03/26/perspectives/stimulus-checks-undocumented-taxpayers/index.html

 

So would a US citizen filing jointly with their spouse who only has an ITIN lose their right to the coronavirus relief check?

Edited March 26, 2020 by LBee1592

[Steeleballz 7,550]

3 hours ago, Lucky Cat said:

If it is a tax credit advance, it is like a loan.......is it not?

 

  It's currently written as tax credit for 2020. We are getting an advance based on eligibility from previous years returns, but it could also be claimed as a credit on the 2020 return instead (if you don't get a check). Conceivably anything missed with a check (ie. newborn child in 2020) could also be claimed as a credit on next years return. Still not finalized though, so they could certainly change things.

[Crazy Cat 39,219]

4 minutes ago, Steeleballz said:

 

  It's currently written as tax credit for 2020. We are getting an advance based on eligibility from previous years returns, but it could also be claimed as a credit on the 2020 return instead (if you don't get a check). Conceivably anything missed with a check (ie. newborn child in 2020) could also be claimed as a credit on next years return. Still not finalized though, so they could certainly change things.

Thanks......I like "tax credit" better than an "advance"......😃